1. The document analyzes the investment performance of shares in Fauji Fertilizer Company (FFC) over 11 years from 2004 to 2014 compared to other investments. 2. Buying 100 shares of FFC for Rs. 10,000 in 2004 and reinvesting dividends earned 460 shares worth Rs. 50,600 today, along with Rs. 39,847 in dividends earned. 3. Other investments such as term deposits, US dollars, and gold provided lower returns over the same period compared to the FFC shares.

1. 1
Invest Beyond Boundaries Pakistan
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ROI - Fauji Fertilizer Company
Research Report -IBBP
IBBP (Investment beyond borders Pakistan) picks Fauji Fertilizer Company on its radar and
investigate its price stability. While taking this task, certain fundamentals of company have
been analyzed below giving a comparison with some other type of investment in return.
1. FFC Case. For analysis purpose it has been assumed that an investor had Rs 10,000 in
hand and bought 100 shares of FFC in year 2004. Investor is carrying his shareholding till to
date. Expansion in his shareholder ship and dividend income in the backdrop of payouts given
by company will be:-
year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Dividend ( in
Rupee)
15 12 10 11 13.7 13.1 13 20 15.5 15.35 7
Bonus in % 30 40 25 10 25 50
Increased
shareholding
with bonus
130 182 228 250 310 460
Dividend
earned in
rupees
1500 2184 1820 2002 2490 2990 3250 6200 7130 7061 3220
Source http://www.ffc.com.pk/dividend-detailsbook-closure.aspx
460 shares held now taking into account bonus given time to time. While taking 110
share value of today, the market value of 460 shares is 50,600. In same period an amount of Rs
39847 is as dividend. This takes the figures to Rs 90,000 for 100 shares of FFC bought 11 years
back in 2004.

2. 2
2. Term Deposit s & Saving Schemes Returns. Investment in Term deposit or saving
scheme is taken as one of the safe and assured means of returns. The details of returns are:-
year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Interest
rate %
10.1 11.04 11.5 11.6 15 16 14.6 14.4 14.6 13.4 14.1
Profit in
rupee
1000 1100 1200 1160 1500 1600 1460 1440 1460 1350 1400
In this case Rs 15,000 rupees approximately comes as a return on investment of Rs
10,000. Defense saving certificates and Behbood Certificates returns approximately 22,000
rupees.
3. Buying US $. General perception is that buying dollar never gives you loss and many
people consider this as one of the best investment. Here is dollar rupees parity taken from year
2004:-
During under review period dollar doubled up giving 100 % return to those holding
dollar.
4. Gold

3. 3
During under researched period gold prices were multiplied by three. In this
specific case rupee- dollar parity effects have been ignored for drawing conclusions.
5. Comparison of ROI
How FFC makes it possible
1. FFC is major player directly and even in collaboration with FFBL in fertilizer sector.
Significant share is of FFC in fertilizer sector.

4. 4
2. Market leader in Urea
3. Shareholding Pattern
S / No Categories of share holders 2011 in % 2012 in % 2013 in %
NIT & ICP 3.91 3.30 2.80
Banks, DFI, NBFI 6.57 6.60 7.0
Insurance companies 10.45 10.58 10.83
Mudarbas and mutual funds 2.56 1.80 1.11
Foreign investors 7.19 8.22 7.80
Charitable trust t & others 48.10 47.88 48
Others 6.38 4.38 1.79
Individuals 14.84 17.78 20.67

5. 5
4. Persistent earning pattern with payout ratio of 97% approximately (basing on 2013)

6. 6
Threats to Fertilizer Sector

7. 7
Future outlook of FFC
Disclaimer
Report is prepared for our institutional and foreign clients and some significant portions are not
being shared. IBBP will not be responsible for any loss realized at any point of time with
investment base taken on this report.