KARACHI: The power sector outperformed the KSE-100 by 11 percent in FY13 ended June 30, generating a return of 60 percent as compared to 49 percent by the Karachi Stock Exchange, analysts said.
After receipt of the amount of the circular debt on June 28, various power sector companies witnessed significant growth in final dividends.
Hub Power Company (Hubco), Kot Addu Power Company (Kapco) and Kohinoor Energy Ltd announced a final dividend of Rs4.5, Rs4.5 and Rs3, respectively in FY13, translating into a final payout ratio of 112 percent, 108 per cent and 104 percent, respectively, they said.
Such payout was a marked improvement as compared to a final dividend of Rs3, Rs3.15 and Rs1.5 by the relevant companies in FY12, taking the final payout ratio to 70 percent, 82 percent and 54 per cent, respectively.
In addition to a higher final dividend, surprise interim payout of Rs6.75 by Kohinoor and Rs2 by Nishat Chunian (NCPL) also delighted investors, placing the abovementioned stocks among the top dividend yielding stocks at the KSE, the analysts said.
Final dividend of Nishat Power Limited (NPL) and NCPL is yet to be announced.
“We are quite hopeful that the same will be a positive surprise for investors. Such an exemplary dividend payout can be attributed to the circular debt settlement of FY13,” Irfan Saeed at Invest Capital said.
“Going forward, we expect improved liquidity to prevail in the sector on account of recent power tariff hike; however, we do not foresee any surprise interim payouts during FY14.”
Currently, the government is bearing Rs5 per unit power tariff differential subsidy mainly due to high electricity generation cost.
The current generation mix is 44 percent dependent on furnace oil and diesel with an estimated cost of Rs17 per unit, he said.
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