Contrary to all the fears of remittance slowdown a few months ago, remittance inflows have now touched an all-time quarterly high in the Jul-Sep period of current fiscal year. These inflows recorded more than 9 percent year-on-year growth to reach $3.927 billion in first quarter FY14, according to central bank data.
Nearly all major remittance origins showed positive growth, with strong showing especially from the United Kingdom, Kingdom of Saudi Arabia (KSA), other GCC countries and the European Union. Remittance inflows in September have been particularly robust, growing by a handsome 13 percent year on year to reach $1.283 billion. Again, significantly higher inflows materialised from the above-mentioned regions.
In the coming months, inflows are expected to remain strong. An Eid-related remittance surge can be expected to be seen in October data, similar to the Eid-ul-Fitr-induced spike seen in July this year. That should be followed by the winter wedding season going into full swing around late November.
The quarterly remittance data points towards another positive aspect. It had been widely feared that the ongoing jobs localisation campaign by Saudi authorities will likely dent Pakistans remittance inflows from this top remittance source. But, instead of a slowdown, the quarterly figures show a 15 percent jump in remittances from the KSA.
On top of that, the share of Saudi remittances in Pakistans overall remittances has also increased from 26.7 percent in 1Q FY13 to 28.1 percent in 1Q FY14. So far, the negative impact of the Saudisation drive is not visible. Or is it that the impact of Saudisation will only trickle a few months after, and what we see now is only the return of savings brought back by returning Pakistanis. A detailed study by policy researchers and remittance authorities should be in order soon.
Also, the continuing growth in remittances should not make the authorities complacent into believing that they don need to take additional measures to incentivise the remittance flow through official channels.
In a June 2013 policy brief for the London-based International Growth Centre, Dr. Rashid Amjad, the former vice chancellor PIDE had advised the policymakers to assess the complex and geographically segregated
emittance market of Pakistan, in major origins like KSA, Dubai, Abu Dhabi, US and the UK. Dr. Amjad estimated the remittance flow through unofficial remittance channels at 30-35 percent of the formal channels.
To reduce unofficial transfers in favour of official inflows, amends have to be made for issues at both the demand (recipient) and supply (sender) sides of the so-called remittance market, besides an appraisal of the role of the intermediaries.
In addition, to maximally exploit the remittance potential and route the incremental inflows towards the countrys industrial development, one expects the policymakers to devise and push investment products and financing mechanisms for the Pakistani Diaspora, soon.
Other corporate results
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SALMAN NOMAN ENTERPRISES LIMITED
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Rs (mn) FY13 FY12 Chg
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Sales-net 1284 1533 -16%
Cost of sales 1204 1570 -23%
Gross profit/(loss) 80 -37
Profit/(loss) before tax -10 -123 -92%
Profit/(loss) after tax -15 -124 -88%
EPS (Rs)-basic -3.28 -27.67
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Source: KSE notice
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FIRST PAK MODARABA
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Rs (mn) FY13 FY12 Chg
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Income-net 6.28 6.68 -6%
Expenditure 4.25 4.80 -12%
Profit/(loss) before tax 2.04 1.88 8%
Profit/(loss) after tax 1.96 1.89 4%
EPS (Rs)-basic 0.16 0.15
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Source: KSE notice
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PAK ELEKTRON LIMITED
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Rs (mn) 9M-FY13 9M-FY12 Chg
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Sales-net 13554 14035 -3%
Cost of sales 10409 11217 -7%
Gross profit 3145 2816 12%
Other income 34 31 10%
Profit before tax 518 130 300%
Profit after tax 443 54 720%
EPS (Rs)-basic 3.37 0.17
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Source: KSE notice
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PAK LEATHER CRAFTS LIMITED
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Rs (mn) FY13 FY12 Chg
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Sales-net 16 12 32%
Cost of sales 41 43 -4%
Gross profit/(loss) -26 -31 -18%
Profit/(loss) before tax -46 -55 -17%
Profit/(loss) after tax -46 -56 -18%
EPS (Rs)-basic -13.51 -16.55
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Source: KSE notice
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RELIENCE WEAVING MILLS LIMITED
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Rs (mn) FY13 FY12 Chg
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Sales-net 9514 8699 9%
Cost of sales 9297 7785 19%
Gross profit 1217 914 33%
Other income 30 24 25%
Profit before tax 549 289 90%
Profit after tax 570 260 119%
EPS (Rs)-basic 18.50 8.45
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Source: KSE notice
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KOHINOOR INDUSTRIES LIMITED
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Rs (mn) FY13 FY12 Chg
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Revenue-net 28.5 9.8 189%
Other operating income 22.4 20.2 11%
Total income 50.9 30.1 69%
Shares of profit/(loss) of associate -11.8 -14.6 -19%
Profit/(loss) before tax 16.0 -12.1
Profit/(loss) after tax -0.8 -13.1 -94%
EPS (Rs)-basic -0.03 -0.43
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Source: KSE notice
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FIRST PRUDENTIAL MODARABA
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Rs (mn) FY13 FY12 Chg
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Income-net 76 80 -5%
Expenditure 50 45 11%
Profit before tax 26 33 -22%
Profit after tax 26 33 -21%
EPS (Rs)-basic 0.30 0.38
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Source: KSE notice
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