Quarterly Report 2022

Quarterly Report 2022

DIRECTORS' REPORT

Directors of Fidelity Capital Management (Pvt.) Limited, the management company of First Fidelity Leasing Modaraba are pleased to present un-audited condensed financial statements of the Modaraba for the first quarter ended September 30, 2022.

The Modaraba during the quarter ended September 30, 2022 earned net profit of Rs. 0.207 million, as compared to profit of Rs. 0.091 million earned in the corresponding quarter ended September 30, 2021. The operation of the Modaraba for the quarter were in marginal profit. On the outset the conversion of Modaraba operations into profitability necessarily depends on the recovery of its major investment in the corporate tower and its deployment into new revenue generating avenues.

As referred to in note 13.2.1 to the financial statements for the year ended June 30,2022 the Modaraba's major portfolio at present is stuck in the corporate tower being constructed by Enplan (Pvt) Limited. On persistent failure of sponsors' commitment, two legal cases were filed against Enplan and its Sponsors. In the first case against recovery of Murabaha finance of Rs 35.0 million the Modaraba Tribunal on February 03, 2022 decreed the case in favor of the Modaraba for an amount of Rs 43.772 million as principal and contracted markup, along with cost of funds from June 1,2014 till the date of realization. M/s Enplan has preferred an appeal before the Honorable Lahore High Court where next date of hearing has been fixed as December 6,2022. In the second case against recovery of Rs 204.0 million the Honorable Lahore High Court had closed the right to argue of Enplan and its sponsors/guarantors. However, on September 5,2022 Enplan had submitted a miscellaneous application in the Lahore High Court for restoration of their right to defend. The case is fixed for hearing on November 16,2022 The Enplan miscellaneous application prima-facie is time barred.. If Enplan miscellaneous application is rejected the decision favoring Modaraba for recovery of Rs 204.0 million along with cost of funds till recovery is likely to be announced sooner.

The Modaraba is likely to recover the decretal amounts from auction of the mortgaged land and building. The valuation is good enough to suffice our decretal amounts. The recovery of decretal amount means we would not only be recovering our principal amounts but also receiving additional substantial amounts in the form of profit and cost of funds.

The accounts can also be accessed at www.fidelitymodaraba.com.

The Board wish to place on record its thanks to the certificate holders, regulatory authorities and financial institutions for their valuable support, guidance and cooperation extended to the Modaraba and look forward to their continued patronage in future. The dedication and hard work put in by the officers and staff of the Modaraba is also acknowledged.

For and on behalf of the Board of Directors

October 26, 2022

Wasim ul Haq Osmani

Lahore

(Chief Executive Officer)

Quarterly Report 2022

Quarterly Report 2022

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First Fidelity Leasing Modaraba published this content on 26 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 October 2022 08:47:01 UTC.