Engro Chemical Pakistan Limited

Topics: Financial ratios, Financial ratio, Balance sheet Pages: 38 (8204 words) Published: September 14, 2008
Engro Chemical Pakistan Limited


Engro Chemical Pakistan Limited is the second largest producer of Urea fertilizer in Pakistan. The company was incorporated in 1965 and was formerly Exxon Chemical Pakistan Limited until 1991, when Exxon decided to divest their fertilizer business on a global basis and sold off its equity of 75% shares in company. The Employees of Engro, in partnership with leading international and local financial institutions bought out Exxon’s equity and the company was renamed as Engro Chemical Pakistan Limited. Engro is a public limited company listed on the Stock Exchanges of Karachi, Lahore and Islamabad. Engro accomplished significant progress not only in its base urea fertilizer business but also in diversification projects. Urea production was increased from an annual capacity of 270,000 tons in 1991 to 850,000 tons in 2001. Further expansion plans are being developed to increase plant capacity to 1.2 million tons in stages. In addition, Engro has over thirty years of experience of fertilizer marketing in Pakistan with an elaborate dealer network. As part of growth and diversification plans, Engro have established a $60 million 50:50 Joint Venture company named “Engro Vopak Terminal Limited” in 1995, between Engro and Royal Vopak (formerly Royal Pakhoed), a Netherlands based company and one of the foremost terminal operators in the world. This joint venture company has built a modern Jetty & Terminal at Port Qasim, Karachi for handling and storage of bulk liquid chemicals, which was completed in 1997. This is a key infrastructure for the development of capital intensive chemical industry in the heavy industrial zone of Port Qasim, Karachi. Engro has also formed another Joint Venture company with Mitsubishi and Asahi Glass of Japan named “Engro Asahi Polymer & Chemicals Ltd.” to develop a Polyvinyl Chloride (PVC) resin project at Port Qasim, Karachi, with an initial capacity of 100,000 tons per year based on imported Vinyl Chloride Monomer. The project has been successfully completed and commenced production in November 1999. The plant production is being marketed both in domestic and export market under the brand name SABZ. Engro has 50% equity in this $74 million venture. Construction of Engro’s 100,000 tons per annum capacity NPK fertilizers plant at Port Qasim at a cost of US $10 million was completed in 2001. The plant is in production and considerably benefiting the country’s agriculture by providing balance nutrition to improve farm yields. During the year 2004 the product’s generic name of NPK was replaced by Zarkhez. In April 2003 Engro acquired 51% interest in the Automation & Control Division of Innovative (Private) Limited, a Lahore (Pakistan) based company that provides process control industrial solutions in the knowledge based services sector. The joint venture has been named as "Innovative Automation & Engineering (Private) Limited (IAEL)".The acquisition was part of Engro’s diversification strategy. Seeds business completed four years of operations and during this period, the Company has made significant progress in developing its own hybrid seeds of maize and sunflower crops and launched two new maize hybrids of imported origin. All seed products are being marketed under the brand name of Bemisal. Engro is an agri based company. Engro’s core business is manufacturing and marketing of chemical fertilizers. Engro is Pakistan’s one of the largest producers of urea fertilizer which is manufactured at Daharki and marketed under brand name Engro. Engro also produce crop specific NPK fertilizers at our plant at Port Qasim Karachi and these are marketed under the brand name of Zarkhez. Engro also markets imported MAP fertilizer under the brand name of Zorawar and imported DAP fertilizer. Recognizing the importance of seeds as an essential agricultural input, Engro has also launched seed business and is marketing imported hybrid and open pollinated seeds of maize...
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