ENGRO to diversify business overseas – Alfalah Securities Limited

Karachi, July 11, 2012 (PPI-OT): As per the recent notice of KSE, Engro Corporation Ltd. (Engro) has shown intention to expand its food, energy and fertilizer manufacturing business overseas to instill growth in the company.

According to Alfalah Securities Limited, the management is also considering options to make available gas supply to its new fertilizer plant Engro ENVEN1.3 which is facing gas supply outages amid shortage in the country. In this regard, Engro has been provided verbal assurance by the government to be allocated gas produced from Reti Maru, Sara West and Loti gas fields though it cannot be relied upon in the absence of any written commitment.

Engro is also eyeing to issue an IPO (initial public offering) of Engro Fertilizer Co. Ltd. once it starts producing urea with persistent supply of gas to the plant since gas supply disruption remains a major threat for the viability of the fertilizer business. Engro is considering to set up a urea plant in Algeria and also evaluating Morocco and Tunisia for setting up a DAP plant due to sufficient availability of gas in these countries. Therefore, the company seems to making all out efforts to revive the profitability trend and hedge itself against the adverse business environment in the local market.