Industry

Engro Fertilizer’s plant is likely to shut down for two months

Karachi, April 20, 2022: The Base plant of Engro Fertilizers Limited is expected to shut down for around 50-60 days during the current year while any increase in gas prices is likely to be passed on by the industry.

This was announced by the management during a corporate briefing session held on Tuesday.

The management also recognized that the lack of clarity on the issue of the expiry of concessionary gas persists and the company has been in discussions with the government and SNGP, hoping for a positive decision.

Meanwhile, the industry still faces the issue of pending Sales tax refunds to the tune of Rs 58 billion due to the input-output tax differential (the EFERT’s share in it is Rs 11 billion).

Moreover, subsidy receivables are another challenge for the industry and the total receivables due from the government are Rs 20 billion with EFERT’s subsidy receivable standing at Rs 6.5 billion.

The management supports the shift to the weighted average cost of gas (WACOG) to address the rising gas circular debt issue. The company recommends direct subsidies for farmers to shield them from higher prices in such a scenario.

In the end, the EFERT announced its 1QCY22 result wherein the company posted earnings of Rs 5.5 billion translating into an EPS of Rs 4.13. The company also announced a dividend of Rs 5.5/share with the result.

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