The statement of Chairman Oil and Gas Regulatory Authority (Ogra) regarding UFG losses is said to have led to panic selling in the shares of Sui gas companies. According to market sources, the Ogra chairman held a press conference on Friday in Islamabad, wherein he revealed that the both Sui gas companies (SSGC and SNGP) may jointly suffer a loss of more than Rs 16 billion on account of Unaccounted for Gas (UFG) in current fiscal year 2012-2012.
The statement stoked panic among investors, as panic selling of the gas companies' shares was witnessed and the share price of Sui North Gas Company Limited and Sui Southern Gas Company declined by Rs 1.27 and Re 0.74 to close at Rs 24.25 and Rs 21.71, respectively. "Although, share price of majority stocks was on decline on Monday, however, statement of chairman Ogra was the basic reason behind decline in share prices of these two companies," market sources said.
They said UFG losses figure was based on Ogra's decisions announced on May 18, 2012 and November 30, 2012. OGRA is fully empowered to pass decisions it deems fit, however, this is the first time that a Chairman has held a press conference going public about prospective losses of the Gas Companies, they added. "Both SSGC and SNGP are public listed companies and any financial statements about these companies are bound to affect their share prices in the stock market," they said. Therefore, section 17 of the Securities Exchange Ordinance 1969 makes it a criminal offence to manipulate prices of listed securities, they added.
Market sources said that government of Pakistan is the largest shareholder of these companies and due to the press conference of the Chairman Ogra the government has faced an estimated loss of some one billion rupee in just one day, due to the fall in value of its shares.
In addition, the public at large also lost hundreds of millions rupee due to decline in share price, they added Investors have urged Securities Exchange Commission of Pakistan (SECP) to take immediate action and initiate an inquiry to ascertain the motives behind the press conference.