786 Investment : Transmission of Quarterly Report for the Period Ended March 31, 2023

FOR THE

QUARTER ENDED

MARCH 31, 2023 (UN-AUDITED)

CONTENTS

Corporate Information	2
Directors' Report	3
	5
Condensed Interim Statement of Financial Position	7
Condensed Interim Profit and Loss Account	8
Condensed Interim Statement of Comprehensive Income	9
Condensed Interim Statement of Changes in Equity	10
Condensed Interim Cash Flow Statement	11
Condensed Interim Notes to the Financial Statements	12

	CORPORATE INFORMATION
Management Company	786 Investments Limited
	G-3 B.R.R. Tower, Hassan Ali Street,
	Off I.I. Chundrigar Road, Karachi - 74000 Pakistan
	Tel: [phone]
	Email: [e-mail]
	Website: www.786investments.com
Board of Directors	Mr. Ahmed Salman Munir	Chairperson
	Miss Tara Uzra Dawood	Chief Executive Officer
	Syed Shabahat Hussain	Director
	Mr. Naveed Ahmed	Director
	Syed Musharaf Ali	Director
	Mr. Iqbal Shafiq	Director
	Mr. Ahmed Zia Sarwar	Director
Chief Financial Officer &
Company Secretary	Mr. Noman Shakir
Audit Committee	Syed Shabahat Hussain	Chairman
	Mr. Naveed Ahmed	Member
	Syed Musharaf Ali	Member
Human Resource	Mr. Ahmed Salman Munir	Chairperson
Commitee	Miss Tara Uzra Dawood	Member
	Mr. Naveed Ahmed	Member
Auditors	JASB & Associates
	Chartered Accountants
Legal Advisor	Rauf & Ghaffar Law Associates (Advocates & Consultants)
	Suite # 65, 5th Floor, Fareed Chamber,
	Abdullah Haroon Road,
	Saddar - Karachi, Pakistan.
Registrars	F.D. Registrar Services (SMC-Pvt.) Ltd.
	Office# 1705, 17th Floor Saima Trade Tower. A,
	I.I. Chundrigar Road, Karachi-74000, Pakistan.
Banker:	Habib Metropolitan Bank Limited
	JS Bank Limited
Rating:	PACRA: AM3

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DIRECTORS' REPORT

FOR THE QUARTER ENDED MARCH 31, 2023

It is matter of honor for me to present on behalf of the Board of Directors (BODs) of 786 Investments Limited ("786" or the "Company") the Management Company of 786 Smart Fund, the reviewed financial statements the three months period ended March 31, 2023.

Economy Review & Outlook:

Global growth prospects at the end of first quarter of 2023 have improved since December, 2022. This improvement is due to China's reopening, a material easing of the European natural gas crisis and resilience in US consumer demand. Since start of the Russia-Ukraine conflict, this is the first upward world growth forecast. Fitch forecast world growth at 2.0% in 2023, revised up from 1.4% in the December 2022. This was mainly due to China's 2023 growth forecast to 5.2% from 4.1%, eurozone growth to 0.8% from 0.2% and US growth to 1.0% from 0.2%. However, lowered global growth in 2024 would reflect the lagged impact of rapid Fed and ECB interest rate hikes. The European gas crisis has eased sharply in recent months with gas supply holding up, inventories improving relative to seasonal norms and wholesale prices are falling significantly. This is helping Eurozone growth prospects and easing headline inflation pressures.

Money Market Review & Outlook:

The Central Bank of Pakistan raised its key interest rate by 100bps to 21% on April 4, 2023, pushing borrowing costs to their highest level since records began in 1992. The MPC noted that inflation rose further to 35.4% in March, the highest since December of 1973, and is expected to remain high in the near term. Looking ahead, the MPC considered the current monetary policy stance appropriate and stressed that the decision, along with previous accumulated monetary tightening, will help achieve the medium-term inflation target over the next 8 quarters. In January 2023, CPI stands at 27.6 percent on a year-on-year basis, which is higher than 24.5 percent in the previous month and 13.0 percent in January 2022. On average, the CPI inflation was recorded at 25.4 percent during Jul-Jan FY2023, which is higher than the 10.3 percent recorded in the same period last year.

Stock Market Review & Outlook:

Pakistan Stock Exchange (PSX) witnessed an overall lackluster week ended on March 10, 2023.The news about US$500 million inflow from China boosted reserves up to US$4.3 billion as of March 03, thereby instilling investor confidence. Despite fulfilling further IMF conditions, i.e. imposition of power surcharge and cabinet approval of 25% GST on luxury items, the long-awaited SLA (Staff-Level Arrangement) still hangs in the balance. The benchmark index closed the week at 41,794 points, indicating a 1.1%WoW gain.

Other major news flows during the week included: 1) Pakistan got closer to signing IMF agreement, 2) Import curbs to be eased after IMF review, 3) Foreign exchange manipulation probe against banks completed, 4) ECP issued schedule for Punjab elections, to be held on April 30 this year, 5) PKR depreciation and borrowing raised debt stocks soar to PKR55 trillion by end January 2023.

Engineering, Tobacco and Cable & Electrical goods were amongst the top performing sectors, As against this, Miscellaneous, Woollen and Textile weaving were amongst the worst performers.

The market is expected to remain range-bound in the near future as already record-high inflation is expected to rise further. Furthermore, the long-awaitedStaff-Level Agreement with the IMF will

remain a topic of focus, and if achieved, could potentially bolster investor confidence and lead to euphoria in the market. Investors are advised to stay cautious while building new positions in the market.

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Company Performance

The Company's profit during the period stood at PKR 8.201 million as compared to PKR 4.036 million in the same period last year. The Company Income which comprised of Management Fees PKR 9,398 million for the period as compared to the PKR 10.098 million last year. Administrative and operating expenses were PKR 21.167 million as compared to PKR 17.937 million in the same period last year. The earnings per share (EPS) of the Company for the period was PKR 0.55 as compared to PKR 0.27 during the corresponding period.

Acknowledgement:

The Directors wish to express their gratitude to the Security & Exchange Commission of Pakistan (SECP) and other regulatory bodies for their valuable support, assistance and guidance. The Board also thanks the employees of the Asset Management Company, the Trustee for their dedication and hard work and the unitholders for their confidence in the Management.

----SD----	----SD----
Director	Chairperson

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