Five Dewan Group companies announce losses

The thread-to-car conglomerate Dewan Group seems to be in dire financial straits as five of its companies on Monday posted losses for six months to December 2008.

Falling demand for the group’s premium products like cars and cement amid dismal economic situation of last year have battered its overall profitability and future outlook, analysts said. “Dewan has taken a lot of loans from banks. It is highly-leveraged and balance-sheet is very weak,” said Khurram Shahzad, analyst at Invest Cap Securities. “Payment ability of the group has reduced substantially over past few years.”

Dewan Faooque Motors, manufacturer and distributor of Hyundai and KIA in Pakistan, announced a staggering loss of Rs707 million for the first half of fiscal year that ends in June 2009, indicating the severe hit automotive industry has taken.

This loss, which is substantially high from Rs74m the company incurred in same period of previous year, is 97 percent of the net sales. Net sales plunged steeply to Rs727m from previous year’s Rs2.6 billion, in what is realization of fears of top industry executives that sales will slide along with economic and political turmoil.

Even now when Pakistan’s macro economic indicators have started to improve on back of falling commodity prices in international markets and IMF-monitored government move to cutback expenditures, analysts say the crisis is far from over.

“Rollback of car-financing schemes by banks following rise in interest rate have definitely discouraged demand,” Shahzad said. “However, car prices fuelled by rupee depreciation have gone up substantially and trend would have to reverse for demand to pick up.”

With inter-bank lending rate dropping to a little over 12 percent on Monday, he said, there are indications of a possible cut in central bank’s discount rate of 15pc. “But demand will depend on stability in exchange rate and inflation.”

Among the group’s other businesses, which were hammered during July-Dec 2008, Dewan Mushtaq Textile Mills announced a loss of Rs3.1m, down 20 percent from previous year’s Rs3.9m.

But prayers of the company’s Chairman Dewan Muhammad Yousuf Farooqui which he had passionately made in the two-paragraph directors report for first July-September quarter have not been answered as sales have gone down 35pc.

Financial losses have marred other textile companies of the group. Loss of Dewan Khalid Textile jumped 26pc to Rs42m from previous year’s Rs34m. Dewan Textile Mills is also in red with Rs200m in losses, up 150pc.

The result of Dewan Farooque Spinning Mills reflects more gloomy condition of the industry in the country as losses have increased over 300pc to Rs53m from Rs12m. Industrialists accept that this punishment is not without a good reason.

MA Jabbar, Chairman SITE Association of Industry, says poor performance of textile makers is repercussion of too much reliance on state’s support for too long.

“Textile industry was not prepared for unexpected changes in global economic situation and what happened at home,” he said, adding: “When government pulled back its hand, businesses just fell.”

Top 25 richest Families in Pakistan

1. The Nishat Group
Mian Muhammad Mansha Yaha is the captain of this splendid ship having around
30 companies on board. Mansha, who owns the Muslim Commercial Bank as well,
is now setting up a billion rupee ($ 17 m) paper sack project too. He is one
of the richest Pakistanis around. Nishat Group was country’s 15th richest
family in 1970, 6th in 1990 and Number 1 in 1997. Mansha is on the board of
nearly 50 companies.

2. The Jang Group
This huge media empire was founded by late Mir Khalil-ur-Rehman some six
decades ago. Today, around 10 top newspapers and the multi-billion rupee GEO,

3. The Hashoo Group
Led by the vintage Saddaruddin Haswani, the Hashoo Group is more known for its dominance in Pakistan’s hotel industry, though the people who know a bit more about the Hashwanis are of their strength in real estate business too.


4. The Packages Group
The seed of this huge empire was sown by Syed Maratib All, a renowned
supplier for British Army and the Indian Railways before partition. The
group launched a joint venture with Lever Brothers soon after 1947, but
massive production of Pakistan Tobacco Company later reportedly made Syed
Maratib All and sons install a packaging Unit by the names of Packages

5. The House of Habib
Legend has it that the Goddess of Wealth has been in love with the seasoned Habibs more than anybody else in Pakistan. Most pundits believe that Habibs
own at least 100 companies throughout the world,

6. The Saigols
Saigols originally hail from Jehlum. The pioneer of the Saigol dynasty in
1890 was Amin Saigol who established a shoe shop that eventually transformed
into Kohinoor Rubber Works

7. Nawa-E-Waqt Group
The Nizamis may not be Rockefellers or the Sheikh Muhammad, but arc the
custodians of a highly influential media empire

8. The Saif Group
Is owned and operated by the sons of famous NWFP lady politician Begum
Kalsum Saifullah. Her eldest son Javid Saifullah heads Ibis very powerful
business group.

9. The Crescent Group
The history of this group dates back to 1910 when Shams Din of Chiniot and
his four sons came into business with a tannery at Amritsar
10. The Monnoo Group
The Monnoo dynasty was founded by two brothers-Dust Muhammad and Nazir Hussain in 19405 at Calcutta. The first unit owned by the Monnoos was the Olympia Rubber Works

11. The Dewan Group
Dewan Yousaf Farooqui. The mentor of this group has been the Sindh Minister for Local Bodies. Industries, Labour, Transport, Mines & Minerals.

12. The Lakson Group
The Lakhanis are currently having a hard lime at the hands of NAB. Sultan
Lakhani and his three brothers run this prestigious group and the chain of
McDonald’s restaurants in Pakistan.

13. The Sapphire Group
Headed by a veteran industrialist Mian Abdullah, this splendid empire owns
11 yarn spinning plants (producing 60,000 tonnes of yarn annually),

14. The Dawood Group
Was ranked Pakistan’s biggest group in 1970, 3rd in 1990 and 15th in 1997

15. The Best Way Group
Sir Anwar Pervaiz is the Chairman of Bestway Group which started off as a
specialist Asian food store in West London in 1962.

16. The Haroon Family
Headed by Yusuf Haroon, 9l, the former Sindh Chief Minister and Governor
West Pakistan, this family owns The Herald Group of publications which
includes the Daily Dawn, Monthly Herald, Aurora and Spider magazines

17. The Yunus Brothers
The Chairman of this group is Abdul Razzak Tabba. This group owns one of the largest warehouses (textile products) in Pakistan.

18. Gul Ahmad/Al-Karam Group
Gul Ahmad is one of the most vibrant Memon business houses in the country
that was founded by Haji Mohammad Pakolawala, but is now split between Gul Ahmad and Al-Karam Group of Industries

19. The Bawany Group
Bawany dynasty was founded by two Bawany brothers, Ahmad Karim Ebrahim office in Japan and nre currently active in textiles, jute, sugar, particle
board, Oxygen, leather, garments, tanneries and cables

20. The Servis Group
Shahid Hussain is the Chairman of this massive foot-wear giant whicb now is
neck-deep in textile business too

21. The Tata Family
Do not confuse the Tatas in Pakistan with their name-sake market leaders in
India,,Jinnah Hospital Lahore). The sitting Federation President Riaz Tata heads the Naveena Exports

22. The Alam Group
This establishment comprising three leather and two textile units is led by
former President Karachi Chamber Shahzada Alam,

23. The Guard Group
The 87-year old Malik Shafi, decorated with Pakistan’s highest civil award, The Guard Group deals in automotive parts, filters, brake fluids and other vital accessories of motor

24. The Ejaz Group
This establishment owns country’s largest knitwear-cum-dyeing facility at
Lahore. More than half a dozen textile units

25. The Tabani Family
The Tabanis are also deemed as one of the biggest groups associated with
manufacturing, trade, export and import business. They are one of the few
Pakistani industrialists holding massive stakes in Central Asian Republics.

Dewan Motors

Dewan Farooque Motors Limited has one of the most advanced automobile assembly plants of South Asia. Located at

Dewan Motors

Dewan City, Sujawal, Thatta, with a total project cost of Rs. 1.8 billion, the plant is built on an area of 42,000 square meters. Selection of the site reflects the commitment of Dewan Group towards building of a prosperous Pakistan and its contribution to national wealth. The project has provided direct employment to over 700 personnel. The plant is the first automobile manufacturing unit in Pakistan to be independently invested by 100% Pakistani investors. The annual capacity of the plant is 10,000 units on a single shift basis. The groundbreaking ceremony for the plant was held in June 1999, and the first Kia Classic rolled-out in a record time of six months. Today the modern state-of-the-art plant is rolling-out cars every day. This is the first and only automobile assembly plant in Pakistan with state of art robotic equipment. Dewan Farooque Motors Limited has technical collaboration and license agreements with the following Korean companies:
Hyundai Motor Company – December 25th 1998
Kia Motors Corporation – July 27th 1999

Dewan Group differences widen

KARACHI: The family disputes in the Dewan Group have been intensified to the extent of filing cases against each other.

According to reliable sources, after increase in the tussle for rights in Dewan Group of Companies, reports have been received about separate occupation of offices and companies by the members of the family.

On the other hand, it is learnt, some very influential persons holding private and government posts have been using their influence for a patch-up in the family. It is further learnt that after widening of differences between the family, financial institutions have started examining the Group matters. The differences have also led to rumours and caused tongues to wag in the stock market.

Financially Dewan Group is a very big group. The Group has a vast business in textile and sugar sectors. It has a big name in the fibre sector. Recently the group has started a business of a chain store in the name of D Mart. Moreover, the group has recently gained a foothold in the oil and gas sector.

It is said that the differences in the group intensified after the death of an elderly woman of the family. Besides brothers, the group matters are also in the hands of cousins. That is why the differences have spread among cousins along with brothers. According to the sources, as a very influential person of the country has relationship with the family, government officers are making hectic efforts to resolve the differences.

Rolls Royce opens showroom in Pakistan

LAHORE: Rolls Royce Motor Cars on Wednesday opened Pakistan’s first showroom in the Punjab capital and announced to establish its outlets also in Karachi and Islamabad.

Dewan Motors has been appointed as an exclusive representative of the motorcar company in the country. Farooq Mustafa, President and Chief Operating Officer of Dewan Motors told this while briefing newsmen at a local hotel. Frank Tiemann, Manager, Corporate Communications, Europe and Middle East, Rolls Royce Motor Cars, Axel Obermuller, Managing Director Europe and Middle East Rolls Royce Motor Cars, Dewan Yousaf Farooqui, Chief Executive Officer of Dewan Motors were also present on the occasion. While briefing about his company, Farooq Mustafa said Dewan Farooque Motors, the first company of Dewan Group-Automotive Operations, opened its doors for business in April 1999 and in short span of seven years, they have grown to seven companies. APP

Rafique Lakhani

Senior Vice President Mr. Rafique Lakhani has over 19 years of experience in financial management and controllership. Prior to joining Abraaj, from 1995 to 2005, he was Chief Financial Officer of the Cupola Group, a regionally focused operating group based in Dubai with diverse business interests in consumer, retail, information and engineering sectors in the Middle East and South Asia. At Cupola, he was responsible for group financial planning and control, treasury and risk management, tax planning, banking relationships, accounting and financial reporting. He also participated in the due diligence and financing of various acquisition and subsequent divestment transactions. Mr. Lakhani was Financial Controller for the Dewan Group in Karachi, Pakistan. Prior to joining Dewan, he was associated with Al Batha Group, Sharjah, U.A.E. as Finance Manager for their Group Treasury. He is a fellow member of the Institute of Chartered Accountants of Pakistan.

AHSL brokers deal between Dewan, Allied

KARACHI: Dewan Group has taken over Allied Groups’ stake in Allied Motors Ltd, and a deal to this effect between Dewan Mushtaq Group and Allied Group was brokered by Arif Habib Securities Ltd (AHSL), said a press release issued by the AHSL here Thursday. The company used to be called Allied Tractors Ltd and assembled tractors of the Ford brand. During the 1990s, the company had a dispute with Ford and the plant has been closed for the number of years. The equity of Allied Motors Ltd is negative and the book value per share after taking into account revaluation of assets in below Rs 4. Dewan Group bought 4,753,259 shares (53 percent) at a rate of Rs 1 and in addition has agreed to take on the responsibility for the discharge of the liabilities of the company, the release said. “The deal was finalised after talks with a number of parties, as it was felt that the interests of the minority shareholders would best be looked after by Dewan Group,” it added. —Staff Report