Shareholding Pattern of Corporate Sector in – An Insight on dominance of Business Groups and Families over Corporate ownership structure

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Shareholding Pattern of Corporate Sector in Pakistan – An Insight on dominance of Business Groups and Families over Corporate ownership structure

Research Department Institute of Cost and Management Accountants of Pakistan (ICMAP) © ALL RIGHTS RESERVED No part of this publication covered by the Copyright may be reproduced, stored in a retrieval system or transmitted in any form or by any means—electronic, mechanical, photocopying, recording or otherwise—without prior written permission of the Research Department, Institute of Cost and Management Accountants of Pakistan, .

© Institute of Cost and Management Accountants of Pakistan, 2011

Published by: Research Department, ICMAP. Institute of Cost and Management Accountants of Pakistan E-mail: [email protected] Website: http://www.icmap.com.pk Fax: +92-21-99243342

Published in 2011

Disclaimer This document has been prepared as an analytical report and is not intended to be exhaustive. While the utmost care has been taken in the preparation of this publication, it should not be relied upon as a substitute for legal advice or as a basis for formulating business decisions. Brief Contents

Page

Foreword 5

From the Desk of Executive Director 6

Chapter 1 Executive Summary 7

Chapter 2 Introduction 11

Chapter 3 Relevant Laws on Company Shareholdings 13

Chapter 4 An Overview of Business Groups and Families 16

Chapter 5 Sector-wise Analysis and Findings 20

Chapter 6 Ownership Category-wise Analysis and Findings 22

Chapter 7 Company-wise Analysis and Findings 25

Annexure (Tables) 43 Contents

Chapter 1 Executive Summary 7 o Business Groups and Family owned companies dominate ownership structure o Ownership structure in ‘ Sector’ is skewed towards ‘Promoters & Directors’ o ‘Associated Companies’ owns above 50% share in Refining and Automobile Sectors o Public’ holds major shareholdings in Insurance, Sugar and cement Sectors o ‘Institutional Investors’ have major stakes in Fertilizer and Pharmaceutical sectors o ‘Pak-Arab Fertilizer’ leads with highest shareholding ownership per Shareholder Chapter 2 Introduction 11 2.1 Concentrated and Dispersed Ownership structures 2.2 Categories of Shareholders and Distribution of Share capital 2.3 Purpose and Objectives of the Study 2.4 Research Design and Data Source 2.5 Sample Selection Chapter 3 Relevant Laws on Company Shareholdings 13 3.1 Requirement for Listed companies to disclose shareholding pattern 3.2 Requirement for company to maintain a Register of Directors’ shareholdings 3.3 Requirement for Directors to make disclosures of shareholdings 3.4 Requirement for Directors to submit statements of beneficial ownership 3.5 Requirement for circulating shareholding information with Directors Report Chapter 4 An Overview of Business Groups and Families 16 4.1 Historical Perspective 4.2 Sector-wise Analysis of Sample Companies Chapter 5 Sector-wise Analysis and Findings 20 Sugar, , Refinery, Fertilizer, Pharmaceutical, cement, Automobile Banks and Insurance sectors Chapter 6 Ownership Category-wise Analysis and Findings 22 o Directors’ ownership category o General Public ownership category o Associated companies ownership category o Institutional ownership category Chapter 7 Company-wise Analysis and Findings 25 Sugar, Textiles, Refinery, Fertilizer, Pharmaceutical, cement, Automobile, Banks and Insurance sectors Annexure (Tables) 43 Shareholding Pattern of Corporate Sector in Pakistan 5

Foreword

I am pleased to present this report titled ‘Shareholding Pattern of the Corporate Sector in Pakistan’, carried out by the Research Department, as part of the project assigned by the Research, Quality Assurance & Ethics Committee of the Institute. In fact, it was thought by the Committee to conduct a brief overview of the shareholding pattern of the listed companies in Pakistan, with a view to provide a useful reference to our members, holding key positions in the industry, as well as our students, who are to step into the Masud Muzaffar, FCMA - Chairman corporate world after completion of their studies. This Research, Quality Assurance & Ethics Committee analytical report, though not very exhaustive, would certainly provide them valuable insight on the ownership structure and style of the listed corporate sector in Pakistan.

A sample group of 44 representative companies; five each from six manufacturing sectors (sugar, textiles, refinery, fertilizer, pharmaceuticals, cement and automobile) and two services sectors (banks and insurance companies) have been selected for this study (due to small base of refinery sector, only four companies have been included). The study summarizes the companies’ shareholders into five categories viz. Directors, General Public, Associated companies, Institutional investors and foreign ownership. I am quite confident that this report would be a useful addition to your study material.

I am indebted to the members of the Research, Quality Assurance & Ethics Committee for their valuable support and input, which led to completion of this report. I must appreciate here the excellent efforts of Mr. Mushtaq Madraswala, Executive Director and the hard work put in by Mr. Shahid Anwar, Deputy Director Research, in compiling and analyzing the data, included in this report. 6 ICMAP Research

From the Desk of Executive Director

It has always been the utmost desire of our Institute to present helpful professional advice and guidance for the benefit of its members, both in practice and in employment. This guidance is also in shape of research-based reports and studies, pertaining to the industry and corporate sector, in addition to information on the core area of cost audit and management accounting. The intention is to keep our members abreast with various industry issues and matters, so as to help them understand industry demands and opportunities in order to Mushtaq A. Madraswala Executive Director play an effective role as ‘strategic leaders’.

The Research Department, which conducts such studies from time to time, has come out with yet another well- researched report on the “Shareholding pattern of Corporate Sector in Pakistan”, aimed at providing an insight to our members on the corporate ownership pattern in different sectors.

I hope that the readers will find this report quite interesting and beneficial. Shareholding Pattern of Corporate Sector in Pakistan 7

Executive Summary

This study examines the shareholding pattern and/or the ownership structure of the corporate sector in Pakistan, by using sample of forty-four representative firms from the manufacturing and services sectors. The manufacturing segment covers seven different sectors namely; sugar, textile, refinery, fertilizer, pharmaceuticals, cement and automobiles, whereas the services sector includes banks and insurance companies. Five companies each from the above nine sectors have been selected, with the exception of refinery sector, where only four companies are included, due mainly to the extremely narrow base of this industry sector. The data on shareholding pattern has been taken from the annual reports of these companies for the financial year 2010. The ownership structure has been classified into the following five major heads for the purpose of this study, and the data have been gathered and compiled accordingly:

(1) Directors ownership (2) General Public ownership (3) Associated companies ownership (4) Institutional ownership (5) Foreign ownership

The directors’ ownership includes the shareholdings in the company by the promoters as well as the directors’ spouses and minor children. The Associated companies are mostly the sister concerns or subsidiary companies of the groups, holding stakes in the selected companies. The Institutional ownership signifies investments made by banks, DFIs, mutual funds, investment companies, financial institutions, insurance companies, non-financial entities such as trusts etc. The foreign ownership refers to shares held by the foreigners and overseas Pakistanis.

Business Groups and Family owned companies dominate ownership structure

ICMAP research establishes the recognized fact that ownership structure in selected companies is mostly concentrated and closely held by business groups and family-run businesses. It is quite evident that in majority cases, the promoters or directors, through the ‘associated companies’ indirectly own the company shares. The family owned companies has, therefore, controlling equity interests, leading to insider control and concentrated ownership in such companies.

It is a fact that being part of a large group of companies, a business firm is in a good position to reap several benefits from the group association. For instance, it can benefit from the goodwill and reputation of the group, as well as share the resources in finance and technology. Thus, a large stake of associated companies may have a positive impact on the company’s performance. However, this also leads to concentration of ownership within the company.

ICMAP study reveals that business groups and families, including trusts and foundations, are controlling the major shareholdings of companies in the manufacturing as well as the services sectors, selected for this study. The pharmaceuticals and automobile sectors are, however, the exceptions, as in these sectors the foreign parent companies have the major stakes. 8 ICMAP Research

ICMAP study concludes that around 64 percent (32 companies) of the 44 selected sample companies are controlled by the prominent business groups and families of Pakistan. These groups of companies include Nishat group, Hasham group, Ghulam Faruque group, Amin Bawany group, group, Crescent group, Sapphire group, Din group, Adam group, Dawood group, Younus Brothers group, Dewan group, Rupali group, Dawood Habib group, Ibrahim group, , Attock group, Fatima group, Engro group, Byco group, EFU group etc.

A detailed analysis of these corporate groups and families is made in Chapter 4 of this Report.

Ownership structure in ‘Textile Sector’ is skewed towards ‘Promoters & Directors’

ICMAP study reveals that the ownership structure in the ‘textile sector’ is highly skewed towards the ‘promoters’ and directors’ of the companies. The directors in five sample textile companies hold around 42 percent share, which is comparatively higher than directors’ ownership in other sectors under study. As an average, the directors’ holds almost 14% share in the textile sector.

Average ownership share of ‘Promoters & Directors’

Sector Share (%) Textile 42% Sugar 31% Fertilizer 15% Banking 13% Cement 07% Automobile 07% Insurance 06% Pharmaceuticals 05% Refinery 0%

‘Associated Companies’ owns above 50% share in Refining and Automobile Sectors

ICMAP study concludes that ‘Associated companies’ have major stake of around 33 percent (average) in the shareholdings of selected sample companies in the manufacturing and services sectors. The following table shows that the associated companies hold more than 50% share, as an average, in the total share capital of selected companies in the ‘Refining’, Pharmaceuticals and ‘Automobile’ sectors. In the ‘Sugar sector’ there is no shareholding of the associated companies. Shareholding Pattern of Corporate Sector in Pakistan 9

Average ownership share of ‘Associated Companies’

Sector Share (%) Refinery 59% Automobile 51% Pharmaceuticals 50% Banking 39% Fertilizer 34% Insurance 29% Cement 26% Textile 7% Sugar 0%

‘General Public’ holds major shareholdings in Insurance, Sugar and cement Sectors

ICMAP study has indicated that the ‘General Public’’ holds a major portion of the shareholding in the Insurance, sugar and cement sectors. The insurance sector is on top with 48% share. As an average, the general public holds around 26% share in the nine sectors selected for this study.

Average ownership share of ‘General Public’

Sector Share (%) Insurance 48% Sugar 42% Cement 38% Textile 31% Banking 19% Refinery 16% Automobile 14% Pharmaceutical 12% Fertilizer 10%

‘Institutional Investors’ have major stakes in Fertilizer and Pharmaceutical sectors It is evident from our study that the institutional investors (i.e. banks, DFIS, insurance companies, financial institutions, modarabas, mutual funds, trusts etc) have major stakes in 10 ICMAP Research

Fertilizer (36%) and Pharmaceutical (32%) sectors. The study further points out that institutional investors have only 9 percent share in the total share capital of five selected companies in the automobile sector. Average ownership share of ‘Institutional Investors’

Sector Share (%) Fertilizer 36% Pharmaceuticals 32% Sugar 25% Cement 22% Banking 22% Refinery 17% Textile 16% Insurance 14% Automobile 09%

As an average, the institutional investors hold around 21 percent share in the shareholdings of the selected representatives companies in both the manufacturing and services sector.

‘Pak-Arab Fertilizer’ leads with highest shareholding ownership per Shareholder

ICMAP study examined the average number of shares held by the shareholders in each sector of industry. The following Chart gives a picture of highest and lowest average share per shareholder:

Manufacturing Sector S.# Sectors Lowest Average Share Highest Average Share 1 Sugar 4,193 (Mirpurkhas Sugar Mill) 37,947 (JDW Sugar Mill) 2 Textile 9,077 (Premium Textile) 38,327 (Sapphire Textile) 3 Cement 35,833 (D.G Khan Cement) 137,522 (Lafarge Cement) 4 Refinery 9,058 (Pakistan Refinery) 26,477 (Byco Refinery) 5 Fertilizer 21,312 (Engro Chemicals) 18,750,000 (Pak Arab Fertilizer) 6 Pharmaceutical 2,084 (Wyeth) 35,394 (GSK) 7 Automobiles 12,351 (Hino Pak) 21,106 (Indus Motors) Services Sector 8 Banks 18,269 (MCB) 97,857 (Bank Al Habib) 9 Insurance 20,020 (Adamjee Insurance) 55,979 (NJI) Shareholding Pattern of Corporate Sector in Pakistan 11

Chapter 2: Introduction

A number of researches conducted in the past on the ownership structure of companies, point out that in the developing economies, the ownership is heavily concentrated. It is concluded that in Asian countries, particularly India; families and groups mostly control the corporate businesses. Pakistan’s case is not too different. This Report aims to establish this very fact. What we conclude from this brief research on shareholding pattern, is that a larger part of the Pakistan’s corporate shareholding structure resembles a concentrated family ownership structure, in which the majority shareholders not only retain control of a company but are also engaged in managing it. This conclusion also substantiates recent research on the corporate governance, suggesting that a ‘large proportion of public companies worldwide are characterized by family-controlled stockholders, usually the founder(s) or their descendants’. 2.1 Concentrated and Dispersed Ownership Structures Corporate ownership structures are generally of two types viz. concentrated and dispersed. In concentrated ownership structures, ownership and/or control is concentrated in the hands of a small number of individuals, families, managers, directors, holding companies, banks and/or other non-financial corporations. These individuals or groups are also called “insiders” as they often manage, control or strongly influence the operation of a company. Accordingly, concentrated ownership structures are referred to as ‘insider systems’. Most countries, especially those governed by civil law, have concentrated ownership structures. The ‘insiders’ exercise control over companies in many ways. For instance, in a scenario where insiders own the majority of the company shares and voting rights. If a few owners own shares with significant voting rights, they can effectively control a company even though they did not provide the majority of the capital. In a dispersed ownership structure, a large number of owners each hold a small number of company shares. Small shareholders have little incentive to closely monitor company activities and tend not to be involved in management decisions or policies. Hence, they are called ‘outsiders’, and dispersed ownership structures are referred to as ‘outsider systems’. Common law countries such as the UK and US tend to have dispersed ownership structures. 2.2 Categories of Shareholders and Distribution of Share capital The share capital structure of a company has different dimensions. The share capital of a company is distributed into various categories of holders such as promoters and directors, general public, institutional investors (such as banks, insurance companies, DFIs, mutual fund companies etc), associated companies and foreign investors. A study of this distribution among the various categories of holders is termed as ‘shareholding pattern’. The shareholding pattern of a company, in fact, provides an insight to the corporate control mechanism practiced in that company and determines its corporate ideology and culture. As such, shareholding pattern differs from company to company and industry to industry. 12 ICMAP Research

2.3 Purpose and Objectives of the Study

The main objectives of this study are to investigate and establish the following facts:

(a) To examine the shareholding pattern of selected Pakistani companies (b) To ascertain the ownership structure in selected industry / services sectors (c) To determine the extent of ownership concentration among the shareholders (d) To evaluate the dominance of business groups and families on corporate sector

2.4 Research Design and Data Source

This study was basically an analytical research, carried out on the basis of shareholding information, provided in the annual reports of selected Listed companies in each industry. The companies provide the relevant shareholding information in compliance with the legal requirement under the Code of Corporate Governance, 2002. The information include:

(a) Pattern of Shareholding, showing the number of shareholders with their corresponding shareholdings and number of shares held by them.

(b) The categories of shareholders, indicating the number of shareholders in each category and the number of shares held, and the percentage of their share in total share capital.

For the purpose of this study, the soft copies of annual reports of the 44 selected sample companies were downloaded from their respective official websites. Since all companies were listed on the Stock Exchanges, as such under the law, they are required to place their annual reports on websites; hence no difficulty in data availability.

2.5 Sample Selection

For this study, we have selected five companies each from seven manufacturing sectors and two services sectors. The manufacturing sector comprises textiles, sugar, cement, fertilizer, refining, automobiles and pharmaceuticals, whereas the services sector includes banks and insurance. In the refining industry only four companies are selected, due to its narrow base. The sectors and companies selected as sample group for this study are identified below:

Sectors Names of Companies Textiles Gul Ahmed, Sapphire, Crescent, Din and Premium Sugar Pangrio, Mehran, Mirpurkhas, Faran and JDW Cement Lafarge, Attock, Lucky, D.G. Khan and Fauji Fertilizer Engro, Fauji, Fatima, Pak-Arab and Dawood Hercules Refinery Pakistan Refinery, National Refinery, Attock and Byco Automobiles Hino Pak, Dewan, Pak Suzuki, Gandhara and Indus Motor Pharmaceuticals GSK, Abbott, Ferozesons, Sanofi Aventis and Wyeth Banks Soneri, Bank Al-Habib, MCB, Askari and Allied Insurance Adamjee, NJI, EFU, United and Premier Shareholding Pattern of Corporate Sector in Pakistan 13

Chapter 3: Relevant Laws on Company Shareholdings

There are two significant legal documents, containing laws and regulations on the shareholding pattern and ownership structures of companies. These laws are Code of Corporate Governance, 2002 and the Companies Ordinance, 1984. The relevant extracts taken from both these legal documents are provided below for ready reference: Code of Corporate Governance, 2002 3.1 Requirement for Listed Companies to disclose shareholding pattern

The Pakistani Code of Corporate Governance, promulgated in 2002, has made it mandatory upon all listed companies to disclose (in the Annual Report) whole shareholding pattern including shares held by financial institutions (both government and privately owned), associated companies and directors and management of the company and their spouse and their minor children. Details of beneficial ownership i.e. shareholders holding ten percent or more interest in the listed company are also required to be disclosed under the Code.

The Clause (xix) of Code of Corporate Governance, 2002 relates to “The Directors’ Report to Shareholders”. Sub-clause (i) of Clause (xix) of the said Code is reproduced below: Quote: (xix) (i) The pattern of shareholding shall be reported to disclose the aggregate number of shares (along with name wise details where stated below) held by: z Associated companies, undertakings and related parties (name-wise details); z NIT and ICP (name wise details); z Directors, CEO and their spouse and minor children (name-wise details); z Executives; z Public sector companies and corporations; z Banks, Development Finance Institutions, Non-Banking Finance Institutions, Insurance companies, modarabas and mutual funds; and z Shareholders holding ten percent or more voting interest in the listed company (name-wise details).

Explanation: For the purpose of this clause, clause (b) of direction (i) and direction (xxiii), the expression “executive” means an employee of a listed company other than the CEO and directors whose basic salary exceeds five hundred thousand rupees in a financial year.

(j) All trades in the shares of the listed company, carried out by its directors, CEO, CFO, Company Secretary and their spouses and minor children shall also be disclosed. Unquote 14 ICMAP Research

Companies Ordinance, 1984

3.2 Requirement for Company to maintain a Register of Directors’ Shareholdings

Section 220 (1) of the Companies Ordinance, 1984 prescribes for keeping a Register at the registered head office of the company, wherein the 10 percent or above shareholdings by the directors, chief executive and other individuals are to be recorded. This Register is to be maintained for inspection by the shareholders of the company. The complete text of Section 220 (1) of the Ordinance is reproduced as under:

Quote: 220. Register of directors’ shareholdings, etc. - (1) Every listed company shall keep a register showing as respects each director, chief executive, managing agent, chief accountant, secretary or auditor of the company, and every other person holding not less than ten per cent of the beneficial interest in the company, the number, description and amount of any shares in, or debentures of, the company or any other body corporate, being the company’s subsidiary or holding company, or a subsidiary of the company's holding company, which are held by or in trust for him, or of which he has a right to become holder, whether on payment or not. Unquote

3.3 Requirement for Directors to make disclosures of shareholdings

Section 221 of the Companies Ordinance, 1984 has required the directors of the company to make disclosures of their shareholding by giving notice to the company. The complete extract of the relevant Section 221 is reproduced as under:

Quote: 221. Duty of directors, etc., to make disclosure of shareholdings, etc. - (1) Every director, officer and such other person as is referred to in sub-section (1) of section 220 shall give notice to the company of such matters relating to himself as may be necessary for the purpose of enabling the company to comply with the provisions of section 220.

(2) The notice referred to in sub-section (1) shall be given in writing within fifteen days of each requisition or change of interest or right, as the case may be, referred to in sub-section (1) of section 220 or date of agreement referred to in sub-section (2) of that section.

(3) Any person who knowingly and willfully fails to comply with sub-section (1) or sub- section (2) shall be punishable with imprisonment for a term, which may extend to two years, or with fine which may extend to five thousand rupees, or with both. Unquote Shareholding Pattern of Corporate Sector in Pakistan 15

3.4 Requirement for Directors to submit statements of beneficial ownership

Section 222 of the Companies Ordinance, 1984 has required the directors of the company to submit statements of beneficial ownership of listed securities on prescribed form. The relevant extract of Section 222 is reproduced as under:

Quote: 222. Submission of statements of beneficial owners of listed securities. - (1) Every director, chief executive, managing agent, chief accountant, secretary or auditor of a listed company who is or has been the beneficial owner of any of its equity securities, and every person who is directly or indirectly the beneficial owner of more than ten per cent of such securities, shall submit to the registrar and the Commission a return in the prescribed form containing the prescribed particulars pertaining to the beneficial ownership of such securities and notify in prescribed form particulars of any change in the interest aforesaid. Unquote

3.5 Requirement for circulating shareholding Information with Director Report

There is another pre-requisite under Section 236 (2) (d) titled “Director’s Report” wherein it has been required that in case of a public company or a private company, which is a subsidiary of a public company, the information about the pattern of holding of shares in prescribed form, shall also be circulated along with the directors report. 16 ICMAP Research

Chapter 4: An Overview of Business Groups and Families

Historical Perspective On the 21st day of April 1968, during the regime of President , the then Chief Economist of the Planning Commission of Pakistan, Dr. Mahboob-ul-Haq, issued a list of 22 wealthiest families of Pakistan, which created a stir in the business and elite circles of the country. According to Dr. Mahboob-ul-Haq, these 22 families controlled 66 percent of the business conglomerates and corporations, and owned 87 percent of the share in the banking and insurance sectors. These richest families included Adamjee, Bawany, Dawood, Saigols, Colony, Valika, Fancy, Crescent, Wazir Ali, Gandhara, Ispahani, Habib, Valika, Khyber, Nishat, Beco, Gul Ahmed, Arag, Hafiz, Karim, Milwala and Dada. These business groups consolidated their holdings during the Ayub Khan regime and remained flourished till early 1970’s, when the then Prime Minister, Zulfiqar Ali Bhutto nationalized the industries in Pakistan. This, however, does not signify the logical end to these business giants and grouping;, most of them survived and sustained their businesses during the nationalization period and flourished steadily in the later years. Sector-wise Analysis of Sample Companies ICMAP research indicates that, even today, the leading corporate groups and families, most of which are in business since the very inception of the country, are holding the controlling stakes of companies in almost all the manufacturing sectors as well as the services sectors, such as banks and insurance companies. As already mentioned in the ‘Executive Summary’ of this Report, in 28 out of 44 sample companies, the business groups/ families have controlling position. Let us now analyze below the dominance of these groups / families in each sector: Sugar Sector

Chart-1 below provides names of Pakistani business groups, which are controlling the major stakes of four sugar mills. Pangrio sugar mill is not included in this chart, as it is not backed by any corporate group or family-run business. Chart – 1: Sugar Sector

Companies Dominating Business Groups Mehran Sugar Hasham Group Mirpurkhas Sugar Ghulam Faruque Group Faran Sugar Amin Bawany Group JDW Sugar JDW Group Shareholding Pattern of Corporate Sector in Pakistan 17

Textile Sector

It can be observed from Chart-2 below that the five leading corporate groups and families are controlling the major stakes in the five textile mills. Chart – 2: Textile Sector

Companies Dominating Business Groups Gul Ahmed Textile Gul Ahmed Family / Group Sapphire Textile Sapphire Group Crescent Textile Crescent Group Din Textile Din Group Premium Textile Adam Group

Refinery Sector

The refinery sector in Pakistan has a very small base, with only five or six companies engaged in the production of refined petroleum products. Out of the four selected refineries, three have controlling stakes of two leading business groups viz. Attock group and Byco group (see Chart-3). Chart – 3: Refinery Sector

Companies Dominating Business Groups Byco Refinery Byco Group National Refinery Attock Oil Group Attock Refinery Attock Group

Fertilizer Sector

It is evident from Chart-4 below that all the selected fertilizer companies are wholly owned by the three major business groups (Dawood, Fatima and Engro) and a leading Charitable trust (Fauji). Chart – 4: Fertilizer Sector

Companies Dominating Business Groups Engro Chemicals Engro Group Fauji Fertilizer Fatima Fertilizer Fatima Group Pak Arab Fertilizer Fatima Group Dawood Hercules Dawood Group 18 ICMAP Research

Pharmaceutical Sector

Chart-5 shows that in the pharmaceutical sector, apart from Ferozesons, which is a Pakistani venture, the other four companies are either subsidiaries or member companies of leading global pharmaceutical firms from UK, USA and France. Chart – 5: Pharmaceutical Sector Companies Dominating Business Groups GlaxoSmithKline (GSK) Parent Company – UK Parent Company – USA Ferozesons Pakistani Company Sanofi Aventis Parent Company – France Wyeth Laboratories Parent Company – USA Cement Sector

It can be observed from Chart-6 below that three Pakistan business group (Attock, Nishat, Yunus Brothers), a French business corporation holds the dominating stake of cement companies. Fauji cement, however, is fully owned by the Fauji Foundation of Pakistan. Chart – 6: Cement Sector

Companies Dominating Business Groups Lafarge Cement Lafarge Group – France Attock Group Yunus Brothers Group D. G. Khan Cement Nishat Group Fauji Cement Fauji Foundation Automobile Sector

Chart-7 indicates that Japanese corporations are having controlling stakes in selected automobile companies in Pakistan, with the exception of , in which major shareholdings are of a Pakistani company viz. Bibojee Service Pvt. Ltd. Indus Motors is owned by Toyota Group. Chart – 7: Automobile Sector Companies Dominating Business Groups Hino Pak Motors Parent Company – Japan Dewan Motors Dewan Group Parent Company – Japan Ghandhara Nissan Bibojee Service Ltd - Pakistan Indus Motors Toyota Group - Japan Shareholding Pattern of Corporate Sector in Pakistan 19

Banking Sector

It is visible from Chart-8 below that leading business groups (Rupali, Dawood, Nishat and Ibrahim) have controlling stakes in the shareholdings of four selected banks. is controlled by Feerasta family, who are owners of Rupali group, whereas Bank Al-Habib is owned by the Dawood Habib group of the Habib Family. Chart – 8: Banking Sector

Companies Dominating Business Groups Soneri Bank Rupali Group Bank Al-Habib Dawood Habib Group MCB Bank Nishat Group Allied Bank Ibrahim Group

Insurance Sector

Chart-9 gives a view of the business group in control of sample insurance companies. Chart – 9: Insurance Sector

Companies Dominating Business Groups Adamjee Insurance Nishat Group United Insurance United International Group NJI Hashoo Group/Agha Khan Foundation EFU EFU Group Premier Insurance Pakistani Company 20 ICMAP Research

Chapter 5: Sector-wise Analysis & Findings

Sugar Sector

The study points out that the ownership structure in the sugar sector is quite diversified. This is evident from the fact that in Pangrio sugar mill, almost 78% shares are in the hands of general public, whereas in Mehran sugar mill, the promoters & directors hold around 76% share of the company. Likewise, in Mirpur Khas sugar mill, the institutional investors hold 74% shares of the company.

Textile Sector

It is concluded from our analysis that the ownership composition in the textile sector is very much skewed towards the promoters and directors of the company, signifying the dominance of group/ family run businesses. It is evident that the Directors’ ownership share in four-selected textile companies viz. Gul Ahmed, Sapphire, Din and Premium textile, ranges between 44 percent to 60 percent. Crescent textile is, however, the exception, in which the Directors’ ownership share is only 5 percent.

Refinery Sector

It reveals from our analysis that the ‘associated companies and undertakings’ are the dominant shareholder in case of refineries, holding in the range of 50% to 68% shares in the total share capital. Quite noticeably, the Directors in all four refineries hold less than 1% share.

Fertilizer Sector

Our analysis shows that ‘associated companies’ hold a larger portion of share capital in three fertilizer companies viz. Engro, Fatima and Pak Arab Fertilizer. In other two companies i.e. Fauji and Dawood Hercules, the institutional investors (including banks, DFIs, financial institutions, modaraba and mutual fund companies, etc) have major stake in the share capital. Pharmaceuticals Sector

It has come to light that in selected three pharmaceutical firms viz. GSK, Abbott and Sanofi Aventis, the foreign parent/ holding companies have over 80% to 100% controlling stake as ‘Associated companies’. This trend is not seen in other two firms i.e. Wyeth and Ferozesons. Shareholding Pattern of Corporate Sector in Pakistan 21

Cement Sector

Our study reveals that sponsors and directors in the four selected cement companies viz. Lafarge, Attock, D.G. Khan and Fauji Cement have less than 4% share in the respective share capitals, except Lucky cement, which has a comparatively higher share of 30% in the share capital of company. It is also seen that the selected cement companies have offered almost 38% share as an average to the general public which is quite good as against other sectors. Automobile Sector

Our analysis indicates that the percentage share of directors’ ownership in the four selected automobile companies viz. Hino Pak, Pak Suzuki, Gandhara Nissan and Indus Motor is less than one percent, with the exception of Dewan Motors, in which the promoters and directors hold around 33% share in the total share capital of the company. Banking Sector It is concluded from our study that only in Allied Bank, the promoters and directors are the dominant shareholders, whereas in other four banks the share of directors is quite limited i.e. less than 11 percent. The associated companies also hold around 39% share as an average in share capital of selected banks. Insurance Sector Our study shows that in the five selected insurance companies, the combined ownership share of general public and associated companies is more dominant, as against other categories of ownership. In United Insurance, the combined share is 97%, whereas in NJI it is 95% and in Premier insurance, this share is around 75 percent. Adamjee insurance follows with 66% sahre and EFU insurance with 54 percent. 22 ICMAP Research

Chapter 6: Ownership Category-wise Analysis & Findings

‘Directors’ Ownership’ Category Our study concludes that the ownership of promoters & directors is more conspicuous in the ‘textile sector’ as most of them are family-controlled. As per ranking table-1, the textile sector companies claims three positions out of five, with 60% share of directors in Sapphire textile, followed by 54% share in Premium and 48% share in Din textile. Overall the average share of directors in the five selected textile companies is 42%.

Two companies from sugar sector viz. Mehran sugar and JDW have also highest concentration of shares in the category of directors ownership, with Mehran sugar on top with 76% share. Our study shows that average share of sugar companies in this category is around 31 percent. Table – 1: Rankings with respect to highest share of ‘Directors Ownership’

Ranking Company Sector Percentage

1 Mehran Sugar Mill Sugar 76%

2 Sapphire Textile Mill Textile 60%

3 Premium Textile Textile 54%

4 Din Textile Textile 48%

5 JDW Sugar Sugar 46%

‘General Public Ownership’ Category

It is indicated from our analysis that ‘insurance companies’ have offered major portion of their share capital to the general public, with an average of around 48% shares. The sugar and cement sectors are two other sectors, which have offered average share of 42% and 38%, respectively, in the general public ownership category.

As per ranking table-2, United insurance with 96% is on top of the ranking, with Premier insurance placed at fourth position. Attock cement with 88% share and Pangrio sugar with 78% share are positioned at second and third rankings as per our analysis. The average share of five selected cement companies in this category is around 38 percent. Shareholding Pattern of Corporate Sector in Pakistan 23

Table – 2: Rankings with respect to highest share of ‘General Public Ownership’

Ranking Company Sector Percentage

1 United Insurance Insurance 96%

2 Attock Cement Cement 88%

3 Pangrio Sugar Mill Sugar 78%

4 Premier Insurance Insurance 63%

5 Crescent Textile Textile 61%

‘Associated Companies Ownership’ Category It is evident from our study that associated companies have dominant ownership stake in three sectors viz. pharmaceuticals, automobile and refinery sectors. Our study concludes that the selected refineries have 59% share of associated companies, followed by 51% share in automobile and 50% share in pharmaceutical sector.

As per ranking table-3, Hino Pak Motors in Automobile sector leads with 89%, followed 79% share each of GSK and Abbot Laboratories, both from Pharmaceutical sector. The Refinery sector companies are not reflected in this ranking, as their shares are less than 70 percent. Table – 3: Rankings with respect to highest share of ‘Associated Companies Ownership’

Ranking Company Sector Percentage

1 Hino Pak Motors Automobile 89%

2 Glaxosmithkline Pharmaceutical 79%

3 Abbott Laboratories Pharmaceutical 79%

4 Lafarge Cement Cement 73%

5 Pak Suzuki Automobiles 73%

‘Institutional Ownership’ Category The institutional investors are mainly banks, DFIs, financial institutions, modaraba and mutual fund companies. Our study suggests that institutional investors have dominant presence in fertilizer, pharmaceutical, sugar and cement sectors. 24 ICMAP Research

As per ranking table-4, Wyeth laboratories (pharmaceutical sector) is on top of the rank with 96% share of institutional investors ownership, followed by 84% share of Dawood Hercules (Fertilizer) and 74% share of Mirpurkhas sugar mill. Fauji fertilizer and D. G. Khan cement are at 4th and 5th ranks with 72% and 48% share, respectively. Table – 4: Rankings with respect to highest share of ‘Institutional Ownership’

Ranking Company Sector Percentage

1 Wyeth Pharmaceutical 96%

2 Dawood Hercules Fertilizer 84%

3 Mirpurkhas Sugar Sugar 74%

4 Fauji Fertilizer Fertilizer 72%

5 D.G. Khan Cement Cement 48% Shareholding Pattern of Corporate Sector in Pakistan 25

Chapter 7: Company-wise Analysis & Findings

1. Sugar Sector 1.1. Selected Companies: The following sugar mills have been selected for this analysis: 1) Pangrio Sugar Mill 2) Mehran Sugar Mill 3) Mirpur Khas Sugar Mill 4) Faran Sugar Mill 5) JDW Sugar Mill 1.2. Key Findings: 1.2.1. Our study reveals that the ownership structure in the sugar sector is quite diversified, with 78% shares held by the general public in Pangrio sugar mill; 76% shares in hand of promoters & directors in Mehran Sugar Mill and 74% shares held by institutional investors in Mirpur Khas Sugar Mill. 1.2.2. Mehran Sugar Mill ranks first in the “Directors’ ownership category”, with highest concentration of 76% share in the total share capital. JDW sugar mill is on second position with 46%, followed by 28% of Mirpur Khas sugar mill. 1.2.3. Pangrio Sugar Mill ranks first in the “General Public ownership category”, with highest concentration of 78% share in the total share capital. JDW sugar mill stands second with 49%, followed by 41% of Faran sugar mill. 1.2.4. Mirpur Khas Sugar Mill ranks first in “Institutional ownership category”, with highest concentration of 74% share in total share capital. Faran sugar mill is on second position with 26%, followed by 19% of Pangrio sugar mill. 1.2.5. The category-wise ‘Average Ownership’ in the five sugar mills, selected for this study, is shown in percentage share as under:

Category (Sugar) Average (%) Directors' Ownership 31% General Public Ownership 42% Associated companies Ownership 0% Foreign Ownership 0% Institutional Ownership 25% 26 ICMAP Research

1.3. Company-wise Analysis of Ownership Structure: 1.3.1. Pangrio Sugar Mill The Directors have only 3% share in the total share capital of the company, whereas the ‘general public’ holding almost 78% shares, is the ‘dominant shareholder’. The ‘Institutional investors’ have 19% stake in the sugar mill. 1.3.2. Mehran Sugar Mill The Directors are the ‘dominant shareholder’ in the company with 76% share, followed by 23% shares held by the general public. It is quite evident that the promoter group /family, having majority shares, runs the company affairs. 1.3.3. Mirpur Khas Sugar Mill Like Pangrio Sugar, the Directors’ ownership share in the total share capital of Mirpur Khas Sugar mill is also 3 percent. However, the ‘dominant shareholder’ here are the ‘Institutional investors’, mostly joint stock companies and financial institutions. The general public holds 21% shares in the company. 1.3.4. Faran Sugar Mill The ownership is quite dispersed with 41% shares held by the general public, which is also the ‘dominant shareholder’ in this case, followed by 28% shares held by the Directors of the company. About 26% of company’s shares are in the hands of institutional investors. 1.3.5. JDW Sugar Mill The ownership is equally balanced with almost 49% shares held by the general public whereas 46% shares are in the hands of the Directors of the company. It can be noted that both the stakeholders seems to be ‘dominant shareholder’ in company. The institutional investors have only 4% share in the share capital. 2. Textile Sector 2.1 Selected Companies: The following textile mills have been selected for this analysis: 1) Gul Ahmed Textile 2) Sapphire Textile 3) Crescent Textile 4) Din Textile 5) Premium Textile 2.2. Key Findings: 2.2.1. It is quite evident from our analysis that ownership in the textile sector, is very much skewed towards the promoters and directors of the company, signifying the dominance of group / family run businesses. Shareholding Pattern of Corporate Sector in Pakistan 27

2.2.2. Sapphire Textile ranks first in the “Directors’ ownership category”, with highest concentration of 60% share in the total share capital. Premium Textile stands second with 54%, followed by 48% of Din and 44% of Gul Ahmed.

2.2.3. Crescent Textile ranks first in the “General Public ownership category”, with highest concentration of 61% share in the total share capital. Din Textile is second with 41% and Gul Ahmed is on third position with 29% share.

2.2.4. Premium Textile ranks first in “Institutional ownership category”, with highest concentration of 31% share in total share capital, followed by 24% share of Crescent Textile and 11% share of Din Textile.

2.2.5. Foreign investors have almost 20% share in total share capital of Gul Ahmed Textile, whereas other four companies do not have any foreign participation. 2.2.6. The category-wise ‘Average Ownership’ in the five textile companies, selected for this study, is shown in percentage share as under:

Category (Textile) Average (%)

Directors' Ownership 42%

General Public Ownership 31%

Associated companies Ownership 7%

Foreign Ownership 4%

Institutional Ownership 16%

2.3. Company-wise Analysis of Ownership Structure: 2.3.1. Gul Ahmed Textile

Around 73% shares of the company are in the hands of Directors and the general public, out of which the Directors’ share is almost 44 percent. The ‘foreign investors’ also hold 20% stake in the company. 2.3.2. Sapphire Textile

The promoters and directors are quite obviously the ‘dominant shareholder’ in the company, holding not only 60% shares but also seem to be well in charge of the company’s affairs by holding indirectly around 24% shares through the Associated companies & undertakings, under their control. The general public has a limited share in the company of only 10 percent. 28 ICMAP Research

2.3.3. Crescent Textile

Unlike Sapphire where the promoters have strong control over the company, the Crescent textile has offered around 61% shares to the general public, out of which around 25% shareholders hold more than 10% of share capital. The promoters and directors have a nominal share of only 5 percent, whereas the institutional investors have a larger share of 24% in the company. 2.3.4. Din Textile

The ownership is equally balanced with almost 48% shares held by promoters and directors, whereas 41% shares are in the hands of the general public. The institutional investors also hold 11% shares in the company. 2.3.5. Premium Textile

The dominant shareholder is the promoter and directors of the company, holding almost 54% shares, whereas the general public has only 14% share in the company. It can be noted that the institutional investors have a larger share of 31% in the company, well over the representation of general public. 3. Refinery Sector 3.1 Selected Companies: The following four petroleum refineries have been selected for this analysis:

1) Byco Refinery 2) Pakistan Refinery 3) National Refinery 4) Attock Refinery 3.2. Key Findings: 3.2.1. It has transpired from our analysis that the ‘associated companies and undertakings’ are the dominant shareholder in case of refineries, holding in the range of 50% to 68% shares in total share capital. Quite noticeably, the Directors in all four refineries hold less than 1% share.

3.2.2. Pakistan Refinery with 0.37% share in total share capital, is ahead of other refineries viz. Byco with 0.1%, Attock 0.07% and National refinery with nil shares in the “Directors’ ownership category”. 3.2.3. Byco Refinery ranks first in the “General Public ownership category”, with highest concentration of 27% share in the total share capital, followed by 14% and 13% of Pak Refinery and Attock Refinery, respectively. Shareholding Pattern of Corporate Sector in Pakistan 29

3.2.4. Pakistan Refinery ranks first in “Institutional ownership category”, with highest concentration of 25% share in total share capital, followed by 22% share of National Refinery and 21% share of Attock Refinery.

3.2.5. Foreign investors (including IDB) have almost 18% share in the total share capital of National Refinery. In Attock Refinery, the foreign investors stake is 4 percent. Pakistan Refinery and Byco do not have any foreign investor share. 3.2.6. The category-wise ‘Average Ownership’ in the four Refineries, selected for this study, is shown in percentage share as under:

Category (Refinery) Average (%)

Directors' Ownership 0%

General Public Ownership 16%

Associated companies Ownership 59%

Foreign Ownership 6%

Institutional Ownership 17%

3.3. Company-wise Analysis of Ownership Structure: 3.3.1 Byco Refinery

Around 68% shares of the company are held by the Associated companies with a negligible share of only 0.14% held by the promoters and directors. The general public has 27% stake in the company. The presence of institutional investors is not much prominent in Byco refinery, having only 1% share. 3.3.2. Pakistan Refinery

With almost 60% share in the total share capital, the associated companies are the ‘dominant shareholder’ in Pakistan refinery. The institutional investors are the second highest stakeholders in the company, having 25% share, followed by 14% share held by the general public. 3.3.3. National Refinery

The Associated companies, having almost 50% share are major shareholder in the company, with 22% share held by the institutional investors and 18% share in possession of foreign investors. The general public has a very nominal share of only 9% in the National refinery. 30 ICMAP Research

3.3.4. Attock Refinery

Like the other refineries, the associated companies and undertakings are the major shareholders in Attock refinery, having 58% share in total share capital. About 21% share are held by the institutional investors, whereas the general public have a share of 13 percent. Foreigners’ hold 4% share in the company. 4. Fertilizer Sector 4.1. Selected Companies: The following five fertilizer companies have been selected for this analysis:

1. (Formerly Engro Chemicals) 2. Fauji Fertilizer 3. Fatima Fertilizer 4. Pak Arab Fertilizer 5. Dawood Hercules Chemical 4.2. Key Findings: 4.2.1. Our analysis reveals that institutional investors (including banks, DFIs, financial institutions, modaraba and mutual fund companies, etc) have major stake in the share capital of Fauji and Dawood Hercules, whereas associated companies hold a larger portion of share capital in Engro, Fatima and Pak Arab Fertilizer companies.

4.2.2. Pak Arab Fertilizer leads the other companies with 41% share in total share capital, in the “Directors’ ownership category”. Fatima is on second position with 21% share, followed by 10% of Dawood Hercules.

4.2.3. Engro Chemicals ranks first in the “General Public ownership category”, with highest concentration of 25% share in total share capital. Engro is second with 22% share, followed by 14% of Fauji and 8% of Fatima Fertilizer.

4.2.4. Fatima Fertilizer is on top of list in the “Associated Companies ownership category”, with highest concentration of 67% share, followed by 53% share of Pak Arab Fertilizer and 48% share of Engro Corp. In Fauji and Dawood Hercules, the associated companies have no contribution in the share capital.

4.2.5. Foreign investors hold a nominal share of 7% in Fauji Fertilizer, whereas in the remaining companies, there are no shares of foreign investors.

4.2.6. The category-wise ‘Average Ownership’ in the five Fertilizer companies, selected for this study, is shown in percentage share as under: Shareholding Pattern of Corporate Sector in Pakistan 31

Category (Fertilizer) Average (%)

Directors' Ownership 15%

General Public Ownership 10%

Associated companies Ownership 34%

Foreign Ownership 1.4%

Institutional Ownership 36%

4.3. Company-wise Analysis of Ownership Structure: 4.3.1. Engro Corporation (formerly Engro Chemical)

The associated companies hold around 48% shares in the total share capital of Engro Corp, majority of which owned by Dawood Group including Dawood Hercules Chemicals. Around 22% shares in the hands of general public and 20% owned by institutional investors. The promoters and directors have a nominal share of 3% in the share capital of the company. 4.3.2. Fauji Fertilizer

The institutional investors own a big portion of around 72% share, and are the definitely the dominant shareholder in the company. Around 14% shares are in the hand of general public, whereas 7% shares held by foreign investors. 4.3.3. Fatima Fertilizer

Being part of Fatima Group, a major share of around 67% shares in the company are held by the associated companies and undertakings. The promoters and directors have 21% share in the share capital of the company, whereas only 8% shares are held by the general public. 4.3.4. Pak Arab Fertilizer

Around 53% shares are in the hands of institutional investors, whereas the promoters and directors hold 41% share in the share capital. The institutional investors (i.e. banks, DFIs, etc) do not have any stake in the company. 4.3.5. Dawood Hercules Chemicals

The institutional investors are quite dominant with around 84% share in the total share capital of the company. The promoters and directors hold 10% share, whereas the general public have 6% stake in the company. 32 ICMAP Research

5. Pharmaceutical Sector 5.1. Selected Companies: The following five pharmaceutical companies have been selected for this analysis:

1. GlaxoSmithKline (GSK) 2. Abbott Laboratories 3. Ferozesons Laboratories 4. Sanofi Aventis 5. Wyeth Laboratories 5.2. Key Findings: 5.2.1. Our analysis indicates that with the exception of Wyeth and Ferozesons, in the other pharmaceutical firms viz. GSK, Abbott and Sanofi Aventis, the foreign parent/ holding companies have around 80% to 100% share as an ‘Associated company’ in the total share capital of the companies.

5.2.2. In GSK the foreign holding company, M/s. Setfirst Ltd, UK have 100% share in the share capital shown in category of ‘Associated companies & undertakings”. Similarly, in Abbott Laboratories, M/s. Abbott Asia Investments Ltd, UK hold 99% share, whereas in Sanofi Aventis, M/s. SECIPE, France holds 81% share. 5.2.3. The average share of ‘directors’ ownership’ in the five selected pharmaceutical companies is only 5.2%, which is very insignificant. The highest concentration of shares in the “Directors’ ownership category” is seen in Ferozesons with 14% share, followed by 12% of Sanofi Aventis.

5.2.4. Ferozesons ranks first in the “General Public ownership category”, with highest concentration of 36% share in total share capital. Abbott is second with 12% share, followed by 4% of Sanofi Aventis and 3% each of GSK and Wyeth.

5.2.5. In GSK and Abbott, the highest share of 79% each is observed in category of “Associated Companies ownership”, which represents the major investment made by their respective foreign principal / holding companies. Sanofi Aventis follows with 65%, out of which 81% is represented by its holding company. Wyeth does not have any share of associated companies.

5.2.6. Wyeth Laboratories is well ahead of other companies with 96% share in the “institutional ownership category”, followed by 21% of Ferozesons. GSK and Sanofi Aventis have 18% share each of institutional investors. 5.2.7. The category-wise ‘Average Ownership’ in five pharmaceutical companies, selected for this study, is shown in percentage share as under: Shareholding Pattern of Corporate Sector in Pakistan 33

Category (Pharmaceutical) Average (%) Directors' Ownership 5% General Public Ownership 12% Associated companies Ownership 50% Foreign Ownership 0% Institutional Ownership 32% 5.3. Company-wise Analysis of Ownership Structure: 5.3.1. GlaxoSmithKline

The associated companies have around 79% shares in the total share capital of GSK, which are wholly owned by its foreign holding company, M/s. Setfirst, UK. The second major investor in GSK with 18% share is the institutional investor, whereas the general public holds only 3% share in the company. 5.3.2. Abbott Laboratories

The associated companies are the dominant shareholders with 79% share in the total share capital, out of which almost 99% share are owned by the holding company, M/s. Abbott Asia Investments Ltd, UK. The general public hold 12% share, whereas institutional investors have a share of 9 percent. 5.3.3. Ferozesons Laboratories

The ownership structure is quite dispersed with 36% of share capital in hands of general public; 27% held by the associated companies; 21% by institutional investors and 14% share owned by the promoters and directors of company. 5.3.4. Sanofi Aventis

The holding company, M/s. SECIPE, France holds almost 81% share, as an associated undertaking in the company, out of 65% of share capital in category of associated companies. The institutional investors have 18% share, whereas 12% share is owned by the sponsors and directors. Only 4% of the share capital has been offered to the general public. 5.3.5. Wyeth Laboratories

The directors of the company hold only 100 shares in the company with almost nil share percentage and the general public have also a meager 3% share. The shares are highly concentrated in the hands of institutional investors with 96% share, whereas there are no associated companies. 34 ICMAP Research

6. Cement Sector 6.1. Selected Companies: The following five cement companies have been selected for this analysis:

1. Lafarge Cement 2. Attock Cement 3. Lucky Cement 4. D.G. Khan Cement 5. Fauji Cement

6.2. Key Findings:

6.2.1. Our study reveals that sponsors and directors in the four selected cement companies viz. Lafarge, Attock, D.G. Khan and Fauji Cement have less than 4% share in the respective share capitals, except Lucky cement, which has a comparatively higher share of 30% in the share capital of company.

6.2.2. The average share of ‘directors’ ownership’ in the five selected cement companies is 6.8%, which is quite insignificant.

6.2.3. Attock Cement ranks first in the “General Public ownership category”, with highest concentration of 88% share in total share capital, followed by 33% of D.G. Khan and 32% of Lucky cement. Fauji is at fourth position with 20% share in the total share capital, whereas Lafarge has only 18% share.

6.2.4. Lafarge Cement has a high concentration of 73% ownership in share capital owned by the associated companies. Fauji is second with 49% share and Lucky follows with 10% share. Attock and D.G. Khan have almost nil share.

6.2.5. The foreign investors hold 11% share in D. G. Khan cement, 3% share in Lafarge and 1% share in Fauji cement. In Attock and Lucky cement, there the foreign investors have made no investments.

6.2.6. D.G. Khan Cement ranks first in the category of “institutional ownership” with 48% share, followed by 30% of Fauji Cement and 12% share each of Attock and Lucky cement. Lafarge has 6% share of institutional investors.

6.2.7. The category-wise ‘Average Ownership’ in five cement companies, selected for this study, is shown in percentage share as under: Shareholding Pattern of Corporate Sector in Pakistan 35

Category (Cement) Average (%) Directors' Ownership 7% General Public Ownership 38% Associated companies Ownership 26% Foreign Ownership 3% Institutional Ownership 22% 6.3. Company-wise Analysis of Ownership Structure: 6.3.1. Lafarge Cement

The associated companies hold around 73% shares in the total share capital, whereas the general public has a share of only 18 percent. The promoters and directors of the company hold only 12,325 shares in the company, which is almost zero percent in the total share capital. 6.3.2. Attock Cement

The associated companies with 88% share are undoubtedly the dominant shareholders in Attock Cement. The institutional investors are the second highest stakeholders with 12% share, whereas the directors of the company hold only 11 shares, out of total share capital of around 86 million shares. 6.3.3. Lucky Cement

The ownership structure is quite dispersed with 32% of share capital in hands of general public and 30% share in custody of the promoters and directors. It is to be noted that the second highest concentration of 17% is in the category of “Others”, detail of which is not specified in the annual report. The institutional investors hold 12% share, whereas the associated companies have 10% stake. 6.3.4. D. G. Khan Cement

The institutional ownership is quite dominant in D.G. Khan with 48% share in total share capital, followed by 33% share of the general public. The foreign investors have a share of around 11% in the share capital of the company. 6.3.5. Fauji Cement

The associated companies are the dominant shareholders with 49% share; followed by 30% share of institutional investors and 20% share of general public. The directors of the company hold only 7 shares out of total share capital of almost 742 million, which is very negligible. 36 ICMAP Research

7. Automobile Sector 7.1. Selected Companies: The following five automobile companies have been selected for this analysis:

1. Hino Pak Motors 2. Dewan Motors 3. Pak Suzuki 4. Ghandhara Nissan 5. Indus Motors 7.2. Key Findings: 7.2.1. Our analysis indicates that the percentage share of directors’ ownership in the four selected automobile companies viz. Hino Pak, Pak Suzuki, Gandhara Nissan and Indus Motor is less than 1 percent, with the exception of Dewan Motors, in which the promoters and directors hold around 33% share in the total share capital of the company. 7.2.2. Dewan Motors ranks first in the “General Public ownership category”, with highest concentration of 41% share in total share capital, followed by 17% of Gandhara Nissan and 6% of Pak Suzuki. Indus Motor and Hino Pak have offered 5% and 2% share, respectively to the general public. 7.2.3. Associated companies are the dominant shareholders in selected auto companies, mainly due to investments by their holding /parent companies. In Hino Pak Motor, around 89% of company’s share capital, representing the associated companies, are wholly owned by parent company, M/s. Toyota Motors Corporation, Japan and Toyota Tsusho Corporation, Japan. Likewise, in Pak Suzuki Motors, almost 73% share capital (under associated companies category) is wholly owned by M/s. Suzuki Motor Corporation, Japan. In Gandhara Nissan, almost 88% share is held by a Pakistani Group viz. M/s. Bibojee Services Pvt. Ltd, whereas 12% share is held by M/s. UD Trucks Corporation, Japan (Formerly Nissan Diesel Motor Co. Ltd., Japan). 7.2.4. M/s. Toyota Motor Corporation and Toyota Tsusho Corporation of Japan collectively hold around 38% share in the total share capital of Indus Motor, whereas 35% share holding is with the Overseas Pakistan Investors AG. The compiled figures indicates that 81% shares of Indus Motor are held by Foreign Investors, including the above two Japanese companies & overseas Pakistanis. 7.2.5. Pak Suzuki Motor ranks first in the category of “institutional ownership” with 13% share, followed by 11% of Dewan Motor and 9% of Hino Pak. 7.2.6. The category-wise ‘Average Ownership’ in the five automobile companies, selected for this study, is shown in percentage share as under: Shareholding Pattern of Corporate Sector in Pakistan 37

Category (Automobile) Average (%) Directors' Ownership 7% General Public Ownership 14% Associated companies Ownership 51% Foreign Ownership 16% Institutional Ownership 9%

7.3. Company-wise Analysis of Ownership Structure: 7.3.1. Hino Pak Motor Holding 89% share in the total capital, the associated companies are the dominant shareholders in the company. The general public share is negligible with only 2 percent, whereas the percentage share of directors’ ownership in the company comes to almost zero. The Institutional investors, however, have 8% stake in Hino Pak Motor. 7.3.2. Dewan Motor The general public is the major shareholders in Dewan with 41% share in the share capital, whereas the promoters and directors also hold 33% share in the company. The associated companies hold around 15% share whereas 11% share is in the hands of institutional investors. 7.3.3. Pak Suzuki Motor M/s. Suzuki Motor Corporation, Japan wholly owns 73% of the total share capital of Pak Suzuki in the category of Associated companies & undertakings. Only 6% shares are in the hands of general public, whereas the institutional investors hold 13% share in the company. 7.3.4. Gandhara Nissan Motor The associated companies have the highest ownership with 73% share, out of which almost 88% are owned by a Pakistani Group viz. M/s. Bibojee Services Pvt. Ltd, whereas 12% share is held by M/s. UD Trucks Corporation, Japan (Formerly Nissan Diesel Motor Co. Ltd., Japan). The general public hold around 17% share, whereas institutional ownership is 8 percent. 7.3.5. Indus Motor Around 38% shares of Indus Motor are owned collectively by M/s. Toyota Motor Corporation and M/s. Toyota Tsusho Corporation, Japan, whereas 35% share is held by the Overseas Pakistan Investors AG. The directors of the company hold only 1% share in the company, whereas 6% each of the share capital are in the hands of institutional investors and associated companies. 38 ICMAP Research

8. Banking Sector 8.1. Selected Banks: The following five Banks have been selected for this analysis:

1. Soneri Bank 2. Bank Al Habib 3. MCB Ltd. 4. Askari Bank 5. Allied Bank 8.2. Key Findings:

8.2.1. It is concluded from our study that only in Allied Bank, the promoters and directors are the dominant shareholders, whereas in other four banks the share of directors is quite limited i.e. less than 11 percent.

8.2.2. Allied Bank ranks first in the category of ‘Directors ownership’ with highest concentration of 44% share in the total share capital, followed by 11% share of Bank Al-Habib and 8% share of MCB Ltd. The other two banks viz. Soneri and Askari have negligible share percentage of 1% and 0% respectively.

8.2.3. Bank Al-Habib leads other selected banks in offering highest share of 47% to the general public. Askari is second with 19% share whereas MCB, Soneri and Allied Bank have less than 15% share of general public in total share capital.

8.2.4. In Soneri, Askari and MCB, more than 50% concentration of shares is witnessed in the category of “Associated Companies ownership”. In Allied Bank associated companies hold 39% share, whereas in Bank Al Habib, only 2% share are held by the associated companies.

8.2.5. MCB Ltd. ranks on top in the category of “foreign ownership” with 16% share, followed by Soneri Bank having 5% share of foreign companies. Bank Al Habib, Askari and Allied Bank have less than 2% share in this category.

8.2.6. The institutional investors are seen dominant in Bank Al Habib (32%), Askari (29%) and Soneri (27%), whereas in MCB Ltd, institutional investors own only 8% share in total share capital.

8.2.7. The category-wise ‘Average Ownership’ in the five selected banks is shown in percentage share as under: Shareholding Pattern of Corporate Sector in Pakistan 39

Category (Banks) Average (%)

Directors' Ownership 13%

General Public Ownership 19%

Associated companies Ownership 39%

Foreign Ownership 5%

Institutional Ownership 22%

8.3. Company-wise Analysis of Ownership Structure: 8.3.1. Soneri Bank

The Feerasta family, owners of the Rupali group, holds the controlling stake in the Soneri bank. The group's primary activities are centered on the synthetic textile industry. The group, through Ferrasta family members and nominees, maintains a dominant position on the bank's board of directors.

The Rupali Group is a leading business group in Pakistan with diverse commercial interests ranging from manufacturing, exporting and indenting to banking and trade financing. The associated companies hold around 53% shares in the total share capital of Soneri Bank, majority of which are owned by the Feerasta family (Rupali Group). Institutional investors own around 27% shares, whereas general public holds only 14 share in the total share capital. 8.3.2. Bank Al-Habib

The Dawood Habib Group of the Habib Family established Bank Al- Habib in Pakistan in 1991 on the invitation of the Pakistani government. The directors and promoters have almost 11% share in the Bank, whereas the general public holds 47% share. Institutional investors own 32% stake in the Bank. 8.3.3. MCB Ltd.

This was the first bank to be privatized in 1991 and was purchased by a consortium of Pakistani corporate groups - led by Nishat Group, which owns a majority stake in the bank. Founded in 1948, Nishat Group is a leading and diversified business group in Pakistan, having strong presence in banking, textile, cement and insurance sectors. In May 2008, Malaysian bank, Maybank and MCB signed an agreement, whereby Maybank acquired 20% of the ordinary shares in MCB from Nishat Group. 40 ICMAP Research

Our research indicates that the “Associated companies”, including Maybank of Malaysia, owns the highest stake of 50% in the MCB, followed by 16% shares owned by the foreigners. The promoters and directors hold only 8% shares in the bank, whereas 15% shares are held by the general public. 8.3.4. Askari Bank The Army Welfare Trust (AWT), as an associated company, owns 51% shares in Askari Bank, followed by the institutional investors (i.e. banks, DFIs, NBFIs, insurance companies etc) holding around 29% shares. The general public owns 19% stake, whereas the directors have almost negligible share in bank. 8.3.5. Allied Bank The Consortium of Ibrahim group and its sponsors hold more than 80% stake in the shareholding of the Allied Bank. The promoters and directors are quite visibly the dominant shareholders in the ABL, with 44% shareholding, followed by 39% shares held by the associated companies. It is to be noted here that M/s. Ibrahim Fibers Ltd, one of the sister concerns of Ibrahim group, owns around 94% share in the associated companies category. The general public have only 1% stake in the bank, whereas the institutional investors hold around 14% share. Ibrahim Leasing Ltd. has also been merged into Allied Bank. 9. Insurance Sector 9.1. Selected Companies: The following five companies have been selected for this analysis: 1. Adamjee Insurance 2. United Insurance 3. New Jubilee Insurance (NJI) 4. Eastern Federal Union Insurance (EFU) 5. Premier Insurance 9.2. Key Findings: 9.2.1. Our study shows that in the five selected insurance companies, the combined ownership share of general public and associated companies is more dominant, as against other categories of ownership. In United Insurance, the combined share is 97%, whereas in NJI it is 95% and in Premier this share is around 75 percent. Adamjee insurance follows with 66% and EFU insurance with 54 percent.

9.2.2. EFU Insurance ranks first in the category of ‘Directors ownership’ with highest concentration of 18% share in the total share capital, followed by 4% share each of NJI and Premier insurance. United insurance and Shareholding Pattern of Corporate Sector in Pakistan 41

Adamjee insurance have both less than 2% share in the directors’ ownership category. 9.2.3. United Insurance is well ahead of other four insurance companies in the category of “general public ownership” with 96% share in the total share capital of the company. Premier insurance is in second position with 63% share, followed by 30% share of Adamjee and NJI, respectively. EFU is the last of these selected insurance companies, with 25% share in this category.

9.2.4. NJI leads the other insurance companies with 65% share in the category of “Associated Companies ownership”. In Adamjee insurance, the associated companies have overall share of 36% whereas in EFU it is 29 percent. Premier insurance and United Insurance have 29% and 1% share, respectively.

9.2.5. EFU and Adamjee are the two insurance companies in which the foreigners own some shares. In EFU foreign ownership is 6% whereas in Adamjee it is around 4 percent. The other companies have no foreign ownership. 9.2.6. The institutional investors are seen dominant in Adamjee insurance (31%), Premier (20%) and EFU (17%), whereas in United and NJI the institutional investors have insignificant share of less than one percent.

9.2.7. The category-wise ‘Average Ownership’ in the five selected insurance companies is shown in percentage share as under:

Category (Insurance) Average (%)

Directors' Ownership 6%

General Public Ownership 50%

Associated companies Ownership 29%

Foreign Ownership 1%

Institutional Ownership 14%

9.3. Company-wise Analysis of Ownership Structure: 9.3.1. Adamjee Insurance

The Nishat Group holds the controlling share in Adamjee insurance. The MCB Bank Ltd., a subsidiary of Nishat group, acquired the management rights of the company in 2004. The ownership structure seems quite evenly spread among associated companies (36%), institutional investors (31%) and general public (30%). MCB Bank Ltd. holds around 82% share 42 ICMAP Research

in the associated companies category. The promoters and directors have negligible share in the company. 9.3.2. United Insurance

The most noticeable feature of United insurance, which differentiates it from other insurance companies, is that almost 96% of its shares are in hands of the general public. The directors own 2% shares in the company, whereas other major stakeholders viz. associated companies and institutional investors have less than 1% share in the insurance company. 9.3.3. New Jubilee Insurance (NJI)

It is quite apparent from the ownership structure of NJI, that the two main stakeholders i.e. associated companies and the general public, collectively hold around 95% share of the company. The directors’ stake in NJI is only 4 percent. 9.3.4. EFU

It appears from EFU’s ownership composition that none of the stakeholder enjoys dominant position. However, the directors and promoters (18% share), in combination with their own associated companies (29% share), have a controlling stake of around 47% in the company. The general public owns around 25% share, whereas the institutional investors have 17% stake in EFU. 9.3.5. Premier Insurance

The general public is quite visibly the dominating stakeholder, with almost 63% share in the total share capital of Premier insurance. The institutional investors hold around 20% share, whereas the associated companies have a share of 12 percent. The directors own only 4% share in the company. Annexure (Tables) 44 ICMAP Research

Annexure (Tables) SUGAR SECTOR

Pangrio Mehran Mirpur Khas Faran JDW Total Shares 10,850,000 14,293,125 7,027,680 21,651,044 48,988,977 No of shareholders 2,559 1,411 1,676 1,821 1,291 Average share per shareholder 4240 10130 4193 11890 37947

Ownership Structure (Value in Number of Shares)

No. Categories Pangrio Mehran Mirpur Khas Faran JDW 1. Directors' Ownership 320,500 10,893,293 179,313 6,098,124 22,732,651 2. General Public Ownership 8,447,898 3,235,757 1,483,337 8,971,441 24,244,308 3. Associated companies 00 000 Ownership 4. Foreign Ownership 0 0 0 0 38,367 5. Institutional Ownership 2,081,602 163,884 5,167,383 5,626,720 1,716,856 6. Others 0 191 197,647 954,759 256795 Total 10,850,000 14,293,125 7,027,680 21,651,044 48,988,977

Ownership Structure (Value in Percentage)

No. Categories Pangrio Mehran Mirpur Khas Faran JDW 1. Directors' Ownership 3% 76% 3% 28% 46% 2. General Public Ownership 78% 23% 21% 41% 49% 3. Associated companies 0% 0% 0% 0% 0% Ownership 4. Foreign Ownership 0% 0% 0% 0% 0% 5. Institutional Ownership 19% 1% 74% 26% 4% 6. Others 0% 0% 3% 4% 1% Total 100% 100% 100% 100% 100% Shareholding Pattern of Corporate Sector in Pakistan 45

TEXTILE SECTOR

Gul Ahmed Sapphire Crescent Din Premium Total Shares 63,478,548 20,083,140 49,209,922 18,530,321 6,163,000 No of shareholders 2,067 524 1,757 829 679 Average share per shareholder 30710 38327 28008 22353 9077

Ownership Structure (Value in Number of Shares)

No. Categories Gul Ahmed Sapphire Crescent Din Premium 1. Directors' Ownership 27,899,996 12,027,824 2,479,312 8,848,038 3,352,450 2. General Public Ownership 18,617,508 1,977,905 30,264,073 7,689,308 879,127 3. Associated companies 0 4,871,729 4,748,525 6,000 0 Ownership 4. Foreign Ownership 12,393,528 0 0 0 0 5. Institutional Ownership 4,567,516 1,205,682 11,700,677 1,986,975 1,931,423 6. Others 0 0 17,335 0 0 Total 63,478,548 20,083,140 49,209,922 18,530,321 6,163,000

Ownership Structure (Value in Percentage)

No. Categories Gul Ahmed Sapphire Crescent Din Premium 1. Directors' Ownership 44% 60% 5% 48% 54% 2. General Public Ownership 29% 10% 61% 41% 14% 3. Associated companies 0% 24% 10% 0% 0% Ownership 4. Foreign Ownership 20% 0% 0% 0% 0% 5. Institutional Ownership 7% 6% 24% 11% 31% 6. Others 0% 0% 0% 0% 0% Total 100% 100% 100% 100% 100% 46 ICMAP Research

REFINERY SECTOR

Byco Pak National Attock Refinery Refinery Refinery Refinery Total Shares 392,104,396 35,000,000 79,966,560 85,293,000 No of shareholders 14,809 3,864 4,282 6,455 Average share per shareholder 26,477 9,058 18,675 13,213

Ownership Structure (Value in Number of Shares)

No. Categories Byco Pak National Attock Refinery Refinery Refinery Refinery 1. Directors' Ownership 565,599 129,963 2,856 56,984 2. General Public Ownership 107,633,967 5,069,347 7,081,963 10,883,324 3. Associated companies 264,755,758 21,012,250 39,983,280 49,371,224 Ownership 4. Foreign Ownership 0 0 14,391,378 3193056 5. Institutional Ownership 2,996,139 8,654,926 17,669,194 17,906,496 6. Others 16,152,933 133,514 837,889 3,881,916 Total 392,104,396 35,000,000 79,966,560 85,293,000

Ownership Structure (Value in Percentage)

No. Categories Byco Pak National Attock Refinery Refinery Refinery Refinery 1. Directors' Ownership 0% 0% 0% 0% 2. General Public Ownership 27% 14% 9% 13% 3. Associated companies 68% 60% 50% 58% Ownership 4. Foreign Ownership 0% 0% 18% 4% 5. Institutional Ownership 1% 25% 22% 21% 6. Others 4% 0% 1% 5% Total 100% 100% 100% 100% Shareholding Pattern of Corporate Sector in Pakistan 47

FERTILIZER SECTOR

Engro Fauji Fatima Pak Arab Dawood Hercules Total Shares 297,942,563 678,527,065 2,000,000,000 450,000,000 120,321,779 No of shareholders 13,980 10,438 17,451 24 2,736 Average share per 21,312 65,005 114,607 18,750,000 43,977 shareholder

Ownership Structure (Value in Number of Shares)

No. Categories Engro Fauji Fatima Pak Arab Dawood Hercules 1. Directors' Ownership 9,441,486 593,161 414,814,333 184,462,062 12,126,986 2. General Public Ownership 65,521,027 95,022,283 154,800,626 0 6,893,084 3. Associated companies 144,390,600 0 1,346,328,761 239,177,781 0 Ownership 4. Foreign Ownership 0 50,133,722 2,950,870 0 0 5. Institutional Ownership 59,891,409 491,247,973 57,578,120 0 101,300,664 6. Others 18,698,041 41,529,926 23,527,290 26,360,157 1,045 Total 297,942,563 678,527,065 2,000,000,000 450,000,000 120,321,779 Ownership Structure (Value in Percentage)

No. Categories Engro Fauji Fatima Pak Arab Dawood Hercules 1. Directors' Ownership 3% 0% 21% 41% 10% 2. General Public Ownership 22% 14% 8% 0% 6% 3. Associated companies 48% 0% 67% 53% 0% Ownership 4. Foreign Ownership 0% 7% 0% 0% 0% 5. Institutional Ownership 20% 72% 3% 0% 84% 6. Others 6% 6% 1% 6% 0% Total 100% 100% 100% 100% 100% 48 ICMAP Research

PHARMACEUTICAL SECTOR

GSK Abbott Ferozesons Sanofi Wyeth Aventis Total Shares 170,671,844 97,900,302 20,832,879 9,644,760 1,421,609 No of shareholders 4,822 2,844 2,321 907 682 Average share per shareholder 35,394 34,423 8,976 10,634 2,084

Ownership Structure (Value in Number of Shares)

No. Categories GSK Abbott Ferozesons Sanofi Wyeth Aventis 1. Directors' Ownership 7,843 37,243 3,004,552 1,120,002 100 2. General Public Ownership 4,653,292 11,788,479 7,551,186 425,620 48,701 3. Associated companies 134,453,588 77,189,064 5,719,917 6,312,805 0 Ownership 4. Foreign Ownership 0 0 0 0 0 5. Institutional Ownership 31,526,758 8,885,516 4,435,022 1,741,397 1,368,161 6. Others 30,363 0 122,202 44,936 4,647 Total 170,671,844 97,900,302 20,832,879 9,644,760 1,421,609 Ownership Structure (Value in Percentage)

No. Categories GSK Abbott Ferozesons Sanofi Wyeth Aventis 1. Directors' Ownership 0% 0% 14% 12% 0% 2. General Public Ownership 3% 12% 36% 4% 3% 3. Associated companies 79% 79% 27% 65% 0% Ownership 4. Foreign Ownership 0% 0% 0% 0% 0% 5. Institutional Ownership 18% 9% 21% 18% 96% 6. Others 0% 0% 1% 0% 0% Total 100% 100% 100% 100% 100% Shareholding Pattern of Corporate Sector in Pakistan 49

CEMENT SECTOR

Lafarge Attock Lucky D.G Khan Fauji Total Shares 1,312,644,488 86,595,439 323,375,000 365,099,265 741,988,686 No of shareholders 9,545 1,184 8,022 10,189 9,520 Average share per shareholder 137,522 73,138 40,311 35,833 77,940

Ownership Structure (Value in Number of Shares)

No. Categories Lafarge Attock Lucky D.G Khan Fauji 1. Directors' Ownership 12,325 11 95,928,999 13,071,517 7 2. General Public Ownership 240,575,211 76,100,272 102,450,190 121,153,832 145,344,559 3. Associated companies 961,116,888 0 31,455,575 0 367,188,207 Ownership

4. Foreign Ownership 33,150,575 77,469 0 40,263,866 5,289,700 5. Institutional Ownership 76,439,438 10,417,687 38,474,407 173,978,683 221,367,665 6. Others 1,350,051 0 55,065,829 16,631,367 2,798,548 Total 1,312,644,488 86,595,439 323,375,000 365,099,265 741,988,686 Ownership Structure (Value in Percentage)

No. Categories Lafarge Attock Lucky D.G Khan Fauji 1. Directors' Ownership 0% 0% 30% 4% 0% 2. General Public Ownership 18% 88% 32% 33% 20% 3. Associated companies 73% 0% 10% 0% 49% Ownership

4. Foreign Ownership 3% 0% 0% 11% 1% 5. Institutional Ownership 6% 12% 12% 48% 30% 6. Others 0% 0% 17% 5% 0% Total 100% 100% 100% 100% 100% 50 ICMAP Research

AUTOMOBILE SECTOR

Hino Pak Dewan Pak Gandhara Indus Suzuki Nissan Motor Total Shares 12,400,560 88,973,255 82,299,851 45,002,500 78,600,000 No of shareholders 1,004 4,291 5,788 2,807 3,724 Average share per shareholder 12,351 20,735 14,219 16,032 21,106 Ownership Structure (Value in Number of Shares)

No. Categories Hino Pak Dewan Pak Suzuki Gandhara Indus Nissan Motor 1. Directors' Ownership 1,080 28,964,985 119 204,833 488,644 2. General Public Ownership 191,350 36,793,242 4,936,973 7,843,651 3,844,902 3. Associated companies 11,036,498 13,650,000 60,154,091 31,698,507 4,931,600 Ownership 4. Foreign Ownership 1,000 0 0 418,750 63,880,779 5. Institutional Ownership 1,170,632 9,565,028 10,429,520 3,782,002 4,441,971 6. Others 0 0 6,779,148 1,054,757 1,012,104 Total 12,400,560 88,973,255 82,299,851 45,002,500 78,600,000 Ownership Structure (Value in Percentage)

No. Categories Hino Pak Dewan Pak Gandhara Indus Suzuki Nissan Motor 1. Directors' Ownership 0% 33% 0% 0% 1% 2. General Public Ownership 2% 41% 6% 17% 5% 3. Associated companies 89% 15% 73% 70% 6% Ownership 4. Foreign Ownership 0% 0% 0% 1% 81% 5. Institutional Ownership 9% 11% 13% 8% 6% 6. Others 0% 0% 8% 2% 1% Total 100% 100% 100% 100% 100% Shareholding Pattern of Corporate Sector in Pakistan 51

BANKING SECTOR

Soneri Bank M.C.B Askari Allied Al-Habib Bank Total Shares 602,322,115 732,164,306 760,214,979 642,743,940 782,100,834 No of shareholders 9,598 7,482 41,612 21,309 40,149 Average share per shareholder 62,755 97,857 18,269 30,163 19,480 Ownership Structure (Value in Number of Shares)

No. Categories Soneri Bank M.C.B Askari Allied Al-Habib Bank 1. Directors' Ownership 8,317,552 81,958,594 57,412,411 14,823 341,398,799 2. General Public Ownership 84,950,386 345,383,757 113,429,359 124,063,927 7,461,415 3. Associated companies 317,249,981 13,681,210 379,123,038 325,014,793 303,364,427 Ownership 4. Foreign Ownership 27,539,575 17,253,727 122,373,480 8,858,630 3,329,507 5. Institutional Ownership 163,817,711 232,932,988 58,468,274 184,791,689 107,045,644 6. Others 446,910 40,954,030 29,408,417 78 19,501,042 Total 602,322,115 732,164,306 760,214,979 642,743,940 782,100,834 Ownership Structure (Value in Percentage)

No. Categories Soneri Bank M.C.B Askari Allied Al-Habib Bank 1. Directors' Ownership 1% 11% 8% 0% 44% 2. General Public Ownership 14% 47% 15% 19% 1% 3. Associated companies 53% 2% 50% 51% 39% Ownership 4. Foreign Ownership 5% 2% 16% 1% 0% 5. Institutional Ownership 27% 32% 8% 29% 14% 6. Others 0% 6% 4% 0% 2% Total 100% 100% 100% 100% 100% 52 ICMAP Research

INSURANCE SECTOR

Adamjee United NJI EFU Premier Total Shares 123,704,543 40,020,000 79,097,707 125,000,000 60,564,269 No of shareholders 6179 879 1413 2630 2634 Average share per shareholder 20,020 45,529 55,979 47,529 22,993

Ownership Structure (Value in Number of Shares)

No. Categories Adamjee United NJI EFU Premier 1. Directors' Ownership 154,967 713,100 2,921,989 22,076,695 2,397,295 2. General Public Ownership 36,532,567 38,490,086 23,570,292 31,871,055 38,321,463 3. Associated companies 44,109,392 509,562 51,199,123 36,208,371 7,449,708 Ownership 4. Foreign Ownership 5,003,812 0 0 8,065,178 0 5. Institutional Ownership 37,903,805 26,557 364,332 20,999,208 12,063,916 6. Others 0 280,695 1,041,971 5779493 331,887 Total 123,704,543 40,020,000 79,097,707 125,000,000 60,564,269

Ownership Structure (Value in Percentage)

No. Categories Adamjee United NJI EFU Premier 1. Directors' Ownership 0% 2% 4% 18% 4% 2. General Public Ownership 30% 96% 30% 25% 63% 3. Associated companies 36% 1% 65% 29% 12% Ownership 4. Foreign Ownership 4% 0% 0% 6% 0% 5. Institutional Ownership 31% 0% 0% 17% 20% 6. Others 0% 1% 1% 5% 1% Total 100% 100% 100% 100% 100% About the ICMAP

The Institute was established in 1951 in the name of "Pakistan Institute of Industrial Accountants (PIIA)" and was chartered by the Government of Pakistan through an Act of Parliament in 1966. In 1976, through an another Act of Parliament, it was renamed as "Institute of Cost and Management Accountants of Pakistan". Mr. Muhamamd Shoaib (Late), the former Finance Minister of Pakistan and a Cost and Management Accountant by profession, laid the foundation of the Institute and also became its founder President in 1951.

Institute of Cost and Management Accountants of Pakistan (ICMAP) is one of the high-ranking accredited professional Institutes in Pakistan, duly recognized by the International Federation of Accountants (IFAC), the South Asian Federation of Accountants (SAFA) and Confederation of Asian and Pacific Accountants (CAPA). At the national level, the professional certification of ICMAP is duly recognized by the Higher Education Commission (HEC) as equivalent to academic Masters Degree.

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Publications of ICMAP's Research Department

1. History of Management Accounting Profession in Pakistan 2. Cost Audit Hand Book 3. Cost Audit Benefits to Industry 4. Glossary of Management Accounting Terms 5. Alternate Dispute Resolution 6. Capacity Utilization of Sugar Mills in SAARC Countries – An Exclusive Comparative Review of Sugar Industry In Pakistan and India 7. Survey Impact of IFRS Applications on Management Accounting Concept & Principles 8. Shareholding Pattern of Corporate Sector in Pakistan – An Insight on dominance of Business Groups and Families over Corporate ownership structure Publications of ICMAP's Research Department

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