NIT declares highest-ever dividend

The National Investment Trust (NIT) has declared the highest-ever dividend of Rs 6.20 per unit for its unit holders for the year ended on June 30. Addressing a press conference after the approval of annual accounts by the board of directors at a local hotel on Wednesday, NIT Chairman Tariq Iqbal Khan said that NIT had again set a new history of excellent performance.
The payment of record dividend at the rate of Rs 6.20 per unit would involve a huge total payout of Rs 10 billion among its unit-holders as against Rs 8.66 billion paid to the unit-holders last year.
It may be mentioned here that the graph of dividend payout by NIUT has shown a consistent upward trend during the last five years, touching the peak of Rs 6.20 per unit for the year ended on June 30, which is 6.9 percent, higher than Rs 5.80 (previous highest) announced by the Trust in 2006 financial year.
He said that the NIT had consistently been able to provide superior return to its unit holders where its net asset value increased from Rs 43.07 (ex-dividend) as of June 30, 2006 to Rs 62.38 as of June 30, 2007 (including a dividend yield of 14.4 percent on NAV at the beginning of the year), which reflected a total return of 44.83 percent for the year ended 2006-07. Thus the NIT had once more been able to outperform the benchmark KSE -100 Index by 6.96 percent, he added.
The Trust earned a net income of Rs 19,813 million, which was the highest ever-net income earned by the Trust in its entire history. Net Income of the Trust depicted a growth of 114.52 percent, increasing to Rs 19,813 million in 2007 financial year from Rs 9,236 million in 2006 financial year. This translates into the record earning per unit of Rs 12.24 in 2007 financial year as compared to the earning per unit of Rs 6.19 earned by the Trust in 2006 financial year. Thus the earning per unit for the 2007 financial year surpassed the last year's highest ever earning per unit mark by 97.74 percent.
The NIT Chairman said that the Trust had realised all time high capital gains of Rs 16.818 billion in 2007 financial year as compared to Rs 6.805 billion recorded last year, which showed a tremendous growth of 147 percent in capital gains of the Trust. This huge capital gains, realised by the Trust, was mainly attributable to the block sale of NIT's holding in Lakson Tobacco, PIC1C, Prime Bank Ltd etc; gains through rightsizing of portfolio, as well as gains realised through normal trading activities, he said, adding the gains realised through rightsizing of HFT and AFS Portfolios stood at Rs 11.07 billion.
It is pertinent to mention here that the NIT has always been following the consistent policy to generate activity in the Stock Market with a view to supporting the market through its operations, enhancing the confidence of investors, working only on delivery based purchases and not to sell in falling market.
This policy has always yielded good results for the Trust. He further said that the dividend income earned by the Trust on its portfolio for the year ended on June 30 stood at Rs 3.08 billion.
The sale of NIT units, including CIPs, during the year ended on June 30 stood at Rs 14.74 billion as against the sale of NIT units worth Rs 5.04 billion in previous year, which depicts a huge increase of 192.5 percent in sale of units over previous year.
NIT units worth Rs 8.62 billion were redeemed during the year under review as against the units worth Rs 10.58 billion redeemed last year. This shows the growing confidence of investors on NIT. The value of Net assets of NIT is another landmark in Mutual Fund Industry. Net assets of the Fund have depicted huge growth of 57 percent by increasing from Rs 64.296 billion as on June 30, 2006 to Rs 100.963 billion as on June 30, 2007.
He said that as of April 1, 2007, the fund has been split into two parts, representing LOC & Non-LOC Holders and now NITL being the Management Company is managing two separate funds.
Tariq Iqbal Khan said that the consistent extraordinary performance of the Fund was attributable to proactive and dynamic guidelines set by the board of directors of NIT and timely and precise execution of such policies by the professional management of the Trust. Deputy Managing Directors Zahid Hussain and Muhammad Nawaz Tishna were also present on this occasion.