KSE drops bomb, 22 firms gone, 9 survive


The front regulators at the recently-demutualised Karachi Stock Exchange (KSE) have decided to delist almost two dozen listed companies for their failure to comply with the listing regulations, it emerged Friday. Also, the KSE management has accepted the request for extension in time of some nine firms which either have shown their intention to rectify the defaults or are in process of rectification of the default.
Friday saw the front regulator notifying the names of at least 22 companies facing delisting from the stock exchange for not complying with the Listing Regulation No.30 that provides for the payment of Annual Listing Fee. The firms under fire have also failed to induct the ordinary shares of the companies into Central Depositary System (CDS) of Central Depository Company (CDC). The 22 firms are: (Colony) Thal Textile Mills Limited, Adil Textile Mills Limited, Dadabhoy Sack Limited, Data Textiles Limited, Genertech Pakistan Limited, Hajra Textile Mills Limited, Kohinoor Industries Limited, Kohinoor Power Company Limited, Mukhtar Textile Mills Limited, (Colony) Sarhad Textile Mills Limited, Annoor Textile Mills Limited, Asim Textile Mills Limited, Central Forest Products Limited, Dadabhoy Construction Technology Limited, Karim Cotton Mills Limited, Khurshid Spinning Mills Limited, Mehr Dastgir Textile Mills Limited, S.S. Oil Mills Limited, Saleem Denim Industries Limited, Service Fabrics Limited, Service Industries Textiles Limited and Taj Textile Mills Limited. The above companies have neither rectified the defaults nor complied with the compulsory direction of the KSE of buy-back of shares from minority shareholders by the sponsors or majority shareholders under the Listing Regulation No.30-A within the stipulated time.
These defaulting firms are therefore liable for action under the said Regulation, said the regulator. Therefore, it said, the Exchange in the interest of investors’ protection and in accordance with Listing Regulation No.30(2)(c) intends to now delist these companies. The concerned companies or their managements have been asked on Friday to inform the Exchange in writing on or before October 1 if they had any objection to the proposed delisting. “Otherwise the Exchange in compliance with the above referred Regulation will proceed further and take action of delisting of the companies,” the notice issued said. The KSE further said trading in the shares of the said companies shall remain suspended under the Sub-section (7) of Section 9 of the Securities and Exchange Ordinance, 1969 and the Listing Regulations of the KSE.
On a positive note, the KSE management extended time for the rectification of defaults to some nine listed firms which were put on defaulters’ counter for the non-payment of Annual Listing Fee and/or non-induction of their ordinary shares into the CDS of the CDC. The Dadabhoy Cement Industries Limited, Nazir Cotton Mills Limited, Saritow Spinning Mills Limited, Sind Fine Textile Mills Limited, Bela Automotives Limited, Hamid Textile Mills Limited, Morafco Industries Limited, Redco Textiles Limited and Globe Textile Mills Limited are the firms that got an extension in time up to October 1 (2012) to rectify their defaults. “The Exchange in consideration of the reasons given by the companies and in the public interest have decided to allow an extension in time,” the KSE said. It advised the companies to ensure to rectify the defaults within the stipulated time, failing which the Exchange would initiate further action including delisting of the companies from the Exchange. Despite extension the relieved firms would, however, see trading in their shares suspended under Sub-Section (7) of Section 9 of the Securities and Exchange Ordinance, 1969 and the Listing Regulations of the Exchange.