Exhibit 1: Fertilizer Plants in Pakistan

Company Location Province

Fauji Fertilizer Limited (FFC)
Plant – I Goth Machi, Rahim Yar Khan Punjab
Plant – II Goth Machi, Rahim Yar Khan Punjab
Plant – III MirpurMathelo, Ghotki Sindh
Fauji Fertilizer Bin Qasim Limited (FFBL)
Plant – I Bin Qasim, Karachi
Sindh
Plant – II Bin Qasim, Karachi
Engro Fertilizers Limited
Plant – I Daharki
Plant – II Bin Qasim, Karachi Sindh
Plant – III Daharki
Dawood Hercules Chemicals Limited (DAWH) Sheikhupura Punjab
Pak Arab Fertilizers Limited (PFL)
Plant – I
Plant – II Multan Punjab
Plant – III
Fatima Fertilizers Company Limited
Plant – I
Plant – II Rahim Yar Khan Punjab
Plant – III
Agritech Limited Mianwali Punjab
Hazara Phosphate Fertilizers Limited (HPFL) Haripur KPK
Lyallpur Chemicals & Fertilizers Limited (LCFL) Jaranwala Punjab

*Source: http://www.arifhabibltd.com/downloads/FertilizerSector2015.pdf
Product Manufactured Annual Capacity (metric tons)*

Urea 2,048,000

Urea 551,000
DAP 650,000

Urea 2,275,000
NPK
Urea
Urea 445,000

Urea 92,000
NP 305,000
CAN 450,000

Urea 500,000
CAN 420,000
NPK 360,000
Urea 467,000
SSP
SSP
Exhibit 2: Fertilizer Supply Demand Situation in Pakistan

(000 Tonnes)
Rabi (Oct-Mar) 2013-14 Kharif (Apr-Sep) 2014 Rabi (Oct-Mar) 2014-15 Kharif (Apr-Sep) 2015
Urea DAP Urea DAP Urea DAP Urea
Opening stock 175 307 386 99 184 430 214
Imports 862 526 122 524 576 498 294
Domestic Production 2,439 292 2,451 400 2,493 332 2,686
Total availability 3,476 1,125 2,959 1,023 3,253 1,260 3,194
Offtake/Demand 3,099 1,075 2,716 586 3,100 1,140 2,425
Write on/off (1) 6 (59) (7) (2) (2) 2
Closing stock 376 56 184 430 151 118 771

Source: Pakistan Economic Surveys

onnes)
Kharif (Apr-Sep) 2015 Rabi (Oct-Mar) 2015-16 Kharif (Apr-Sep) 2016
DAP Urea DAP Urea DAP
139 771 523 1,200 253
376 50 833 - 482
421 2,817 369 3,078 416
936 3,638 1,725 4,278 1,151
414 2,434 1,439 2,704 697
1 (2) - (9) 4
523 1,202 286 1,565 458
Exhibit 3: Engro Fertilizer’s Journey and Key Milestones

Source: Engro Fertilizers Limited – Company Presentation

Source: Engro Fertilizers Limited – Company Presentation

Exhibit 4: Engro Fertilizers Limited – Financial Statements

2012 2013 2014 2015

(million PKR)
Income Statements
Revenue 30,627 50,129 61,425 85,421
Cost of goods sold (20,766) (28,008) (38,822) (55,724)
Gross income 9,861 22,121 22,603 29,697
Operating expenses (3,291) (6,118) (6,260) (8,395)
Operating income 6,570 16,003 16,343 21,302
Interest expense (8,549) (6,635) (5,693) (3,932)
Foreign exchange losses (gains) (2,154) (2,035) (722) (682)
Net non-operating losses (gains) 181 1,051 1,533 4,380
Pretax income (3,952) 8,384 11,461 21,068
Income tax 1,017 (2,887) (3,687) (6,249)
Net income (2,935) 5,497 7,774 14,819

EPS (PKR) (2.74) 4.66 6.29 11.13

Balance Sheets

Cash & Near Cash Items 2,449 1,852 4,443 924

Short Term Investments 2,635 20,664 25,084 11,650
Accounts & Notes Receivable 1,046 758 757 2,262
Inventories 5,794 5,751 5,815 11,669
Other Current Assets 2,460 1,341 452 2,688
Total Current Assets 14,385 30,366 36,551 29,192
Long Term Investments 0 0 94 160
Net Fixed Assets 82,878 79,315 74,963 72,198
Gross Fixed Assets 98,800 100,011 100,260 102,177
Accumulated Depreciation 15,922 20,696 25,298 29,978
Other Long Term Assets 245 248 118 4,535
Total Long-Term Assets 83,123 79,563 75,175 76,894
Total Assets 97,508 109,929 111,726 106,086

Accounts Payable 1,848 6,200 14,616 11,224

Short Term Borrowings 15,896 2,924 7,913 10,812
Other Short Term Liabilities 8,506 13,549 13,282 10,343
Total Current Liabilities 26,250 22,673 35,811 32,379
Long Term Borrowings 51,482 55,896 36,091 25,290
Other Long Term Borrowings 3,978 6,290 5,347 6,085
Total Long Term Liabilities 55,459 62,186 41,437 31,375
Total Liabilities 81,710 84,860 77,248 63,754

Share Capital & APIC 10,739 12,239 15,444 16,442

Retained Earnings & Other Equity 5,059 12,830 19,034 25,890
Total Shareholders Equity 15,798 25,069 34,478 42,332

Total Liabilities & Equity 97,508 109,929 111,726 106,086

Source: Bloomberg
2016

69,537
(52,098)
17,439
(8,762)
8,677
(3,109)
(157)
8,223
13,634
(4,351)
9,283

6.91

84
1,040
7,585
11,686
7,669
28,064
121
70,168
105,135
34,967
4,451
74,740
102,804

7,355
7,081
9,620
24,057
29,380
7,718
37,098
61,155

16,442
25,207
41,648

102,804
Exhibit 5: Fertilizer Industry Data

Company Name Price as at Shares Outstanding Total Debt Revenue (million EPS
Dec 31, 2016 (million) (million PKR) PKR) (PKR)
(PKR)
Engro Fertilizer 68 1,330.9 36,461 69,537.3 7.0
Fatima Fertilizer 36.9 2,100.0 34,964 33,764.6 4.7
Fauji Fertilizer Co. 104.4 1,272.2 54,368 75,377.9 9.4
Fauji Fertilizer Bin Qasim 51.2 934.1 66,740 49,222.2 1.0

Source: Bloomberg
Beta

0.91
0.86
1.04
Exhibit 6: Capital Market Data and Other Related Information

Pakistan Investment Bonds (PIBs) (January 26, 2017)

Tenor Weighted Average Yield
3-Year 6.3304%
5-Year 6.8998%
10-Year 7.9414%
Source: State Bank of Pakistan - http://www.sbp.org.pk/ecodata/Pakinvestbonds.pdf

Market Treasury Bill (February 1, 2017)

Tenor Weighted Average Yield
3-Month 5.9211%
6-Month 5.9714%
12-Month 5.9489%
Source: State Bank of Pakistan - http://www.sbp.org.pk/ecodata/tb.pdf

Effective Marginal Tax Rate 30%

Exhibit 7: Daily Market Price and Index Data

KSE 100 EFERT

16-Jan-14 26730.24 28.25
17-Jan-14 26913.85 29.66
20-Jan-14 27000.95 31.14
21-Jan-14 27104.70 32.69
22-Jan-14 27015.12 34.32
23-Jan-14 27064.34 36.03
24-Jan-14 27002.89 37.83
27-Jan-14 26670.60 39.72
28-Jan-14 26653.73 41.70
29-Jan-14 26595.63 43.78
30-Jan-14 26607.64 45.96
31-Jan-14 26784.34 48.25
3-Feb-14 26946.10 48.48
4-Feb-14 26751.45 47.00
6-Feb-14 26862.51 46.77
7-Feb-14 26681.78 49.09 Source: Ismail Iqbal Securities (Pvt.) Ltd.
10-Feb-14 26255.21 49.28
11-Feb-14 26240.41 51.46
12-Feb-14 26677.27 54.03
13-Feb-14 26541.26 56.73
14-Feb-14 26394.13 55.35
17-Feb-14 26003.89 54.14
18-Feb-14 25884.38 53.16
19-Feb-14 25686.93 54.13
20-Feb-14 25506.80 54.15
21-Feb-14 25603.35 56.85
24-Feb-14 25773.81 59.69
25-Feb-14 25559.61 59.04
26-Feb-14 25500.50 59.96
27-Feb-14 25478.93 59.73
28-Feb-14 25783.28 59.63
3-Mar-14 25853.54 56.67
4-Mar-14 26209.38 55.76
5-Mar-14 26521.99 56.31
6-Mar-14 26842.53 57.38
7-Mar-14 26892.23 57.13
10-Mar-14 27176.26 56.33
11-Mar-14 27309.02 57.17
12-Mar-14 27115.20 59.06
13-Mar-14 27083.12 58.29
14-Mar-14 27124.47 57.82
17-Mar-14 27229.10 57.53
18-Mar-14 27246.97 57.14
19-Mar-14 27258.68 56.92
20-Mar-14 27148.52 57.19
21-Mar-14 26765.49 56.83
24-Mar-14 26391.41 56.58
25-Mar-14 26670.14 59.40
26-Mar-14 26821.92 59.91
27-Mar-14 27165.49 59.57
28-Mar-14 27116.13 58.82
31-Mar-14 27159.91 59.70
1-Apr-14 27565.50 60.84
2-Apr-14 27932.02 60.60
3-Apr-14 28336.36 61.51
4-Apr-14 28408.03 61.22
 7-Apr-14 28578.96 61.20
8-Apr-14 28653.37 63.66
9-Apr-14 28941.01 62.82
10-Apr-14 29250.54 63.48
11-Apr-14 29249.44 66.65
14-Apr-14 29094.12 69.98
15-Apr-14 29095.77 70.84
16-Apr-14 29458.15 68.99
17-Apr-14 29350.34 70.08
18-Apr-14 29069.93 70.95
21-Apr-14 28878.77 69.95
22-Apr-14 29191.84 69.32
23-Apr-14 28717.19 66.72
24-Apr-14 28786.74 69.57
25-Apr-14 28850.08 67.60
28-Apr-14 28691.62 66.18
29-Apr-14 28436.59 64.33
30-Apr-14 28912.98 66.55
2-May-14 28921.13 66.89
5-May-14 28629.63 65.60
6-May-14 28383.20 64.40
7-May-14 28330.03 65.14
8-May-14 28511.02 63.57
9-May-14 28494.54 63.38
12-May-14 28343.88 60.81
13-May-14 28411.49 61.04
14-May-14 28528.19 61.67
15-May-14 28843.02 61.84
16-May-14 28883.33 61.68
19-May-14 28951.38 60.71
20-May-14 28842.92 60.69
21-May-14 28760.12 59.98
22-May-14 28741.55 59.63
23-May-14 28756.00 59.15
26-May-14 29020.48 59.83
27-May-14 29048.21 60.02
28-May-14 28987.32 62.16
29-May-14 29543.58 63.57
30-May-14 29737.69 63.81
2-Jun-14 29789.85 60.80
3-Jun-14 29504.98 59.88
4-Jun-14 29452.23 59.38
5-Jun-14 29417.20 58.62
6-Jun-14 29509.11 57.89
9-Jun-14 29472.52 58.31
10-Jun-14 29540.72 59.05
11-Jun-14 29783.30 59.49
12-Jun-14 29766.38 59.01
13-Jun-14 29730.86 58.46
16-Jun-14 29651.04 58.08
17-Jun-14 29324.60 57.90
18-Jun-14 29157.98 59.44
19-Jun-14 28674.37 58.37
20-Jun-14 28691.84 57.82
23-Jun-14 28999.03 58.61
24-Jun-14 29057.44 58.31
25-Jun-14 28981.34 57.65
26-Jun-14 29188.53 57.90
27-Jun-14 29343.76 57.88
30-Jun-14 29652.53 57.15
 1-Jul-14 29701.58 56.15
2-Jul-14 29676.80 56.12
3-Jul-14 29697.79 55.85
4-Jul-14 29619.84 55.53
7-Jul-14 29528.96 55.55
8-Jul-14 29497.57 55.38
9-Jul-14 29477.29 54.98
10-Jul-14 29353.12 53.95
11-Jul-14 29318.06 53.90
14-Jul-14 29705.07 54.94
15-Jul-14 29683.97 54.24
16-Jul-14 29776.17 54.03
17-Jul-14 30177.11 54.72
18-Jul-14 30224.89 55.00
21-Jul-14 30413.23 55.07
22-Jul-14 30402.09 54.98
23-Jul-14 30465.43 55.48
24-Jul-14 30474.75 54.92
28-Jul-14 30314.07 54.64
4-Aug-14 29647.83 53.12
5-Aug-14 29676.41 55.76
6-Aug-14 29382.97 54.97
7-Aug-14 29537.04 55.78
8-Aug-14 29380.50 57.13
11-Aug-14 28071.41 54.28
12-Aug-14 28304.50 53.30
13-Aug-14 28505.55 54.21
15-Aug-14 28917.75 54.11
18-Aug-14 28852.15 53.77
19-Aug-14 28630.12 52.82
20-Aug-14 28664.84 53.26
21-Aug-14 28865.25 53.69
22-Aug-14 28871.75 53.77
25-Aug-14 28519.34 53.20
26-Aug-14 28243.59 52.90
27-Aug-14 27811.35 51.75
28-Aug-14 27774.43 52.50
29-Aug-14 28567.74 53.90
1-Sep-14 28493.74 52.58
2-Sep-14 29260.29 53.39
3-Sep-14 29595.55 53.28
4-Sep-14 29604.30 54.89
5-Sep-14 29513.78 53.79
8-Sep-14 29585.60 53.60
9-Sep-14 29728.91 53.76
10-Sep-14 29691.31 53.01
11-Sep-14 29858.37 54.51
12-Sep-14 30044.89 54.06
15-Sep-14 30070.13 54.02
16-Sep-14 30180.30 54.34
17-Sep-14 30136.57 54.26
18-Sep-14 30094.16 54.09
19-Sep-14 30015.80 54.29
22-Sep-14 29993.87 54.01
23-Sep-14 30143.77 53.83
24-Sep-14 30095.80 54.01
25-Sep-14 29940.27 53.62
26-Sep-14 29705.65 53.55
29-Sep-14 29383.13 53.50
30-Sep-14 29726.39 53.61
 1-Oct-14 29996.61 54.43
2-Oct-14 30071.58 55.14
3-Oct-14 30103.23 55.10
9-Oct-14 29978.94 55.04
10-Oct-14 30158.63 56.90
13-Oct-14 30394.41 57.22
14-Oct-14 30355.22 57.49
15-Oct-14 30120.99 57.46
16-Oct-14 29982.45 57.06
17-Oct-14 29883.10 56.41
20-Oct-14 29711.12 55.87
21-Oct-14 29694.27 55.02
22-Oct-14 29940.39 55.46
23-Oct-14 30025.13 56.12
24-Oct-14 30098.49 57.40
27-Oct-14 30238.96 57.03
28-Oct-14 30225.62 56.78
29-Oct-14 30113.24 59.43
30-Oct-14 30204.09 58.58
31-Oct-14 30376.53 58.09
5-Nov-14 30593.31 58.96
6-Nov-14 30663.78 60.66
7-Nov-14 30930.04 61.07
10-Nov-14 31281.83 61.63
11-Nov-14 31303.63 61.34
12-Nov-14 31629.20 63.83
13-Nov-14 31441.82 64.78
14-Nov-14 31344.07 62.01
17-Nov-14 31702.79 64.91
18-Nov-14 32006.40 65.34
19-Nov-14 31756.29 66.04
20-Nov-14 31239.04 63.56
21-Nov-14 31494.84 64.94
24-Nov-14 31316.96 62.08
25-Nov-14 31223.74 62.43
26-Nov-14 31454.47 62.37
27-Nov-14 31270.10 62.08
28-Nov-14 31197.98 63.05
1-Dec-14 31299.72 65.74
2-Dec-14 31680.72 67.44
3-Dec-14 31872.73 69.18
4-Dec-14 32090.93 68.11
5-Dec-14 32148.78 67.89
8-Dec-14 32010.33 67.20
9-Dec-14 32084.16 68.24
10-Dec-14 31781.65 66.57
11-Dec-14 31779.75 65.77
12-Dec-14 31589.82 66.01
15-Dec-14 31690.10 67.09
16-Dec-14 30876.28 65.23
17-Dec-14 30667.14 65.38
18-Dec-14 30827.45 65.02
19-Dec-14 31011.15 65.38
22-Dec-14 31491.62 66.03
23-Dec-14 31750.38 65.69
24-Dec-14 32000.01 67.70
26-Dec-14 31993.01 71.08
29-Dec-14 31906.74 73.02
30-Dec-14 31953.90 74.47
31-Dec-14 32131.28 78.10
 1-Jan-15 32503.80 82.00
2-Jan-15 32731.61 81.92
5-Jan-15 32757.79 81.19
6-Jan-15 32668.73 79.03
7-Jan-15 32835.94 77.75
8-Jan-15 33117.47 80.85
9-Jan-15 33324.82 79.21
12-Jan-15 33418.20 78.99
13-Jan-15 33371.29 76.54
14-Jan-15 33585.75 78.82
15-Jan-15 33765.61 77.88
16-Jan-15 33786.44 77.44
19-Jan-15 34014.26 78.98
20-Jan-15 34121.30 78.39
21-Jan-15 34329.50 79.23
22-Jan-15 34146.97 77.91
23-Jan-15 34026.59 79.51
26-Jan-15 34466.53 80.67
27-Jan-15 34538.45 80.02
28-Jan-15 34386.86 80.60
29-Jan-15 34408.73 81.42
30-Jan-15 34443.87 85.27
2-Feb-15 34676.31 84.94
3-Feb-15 34826.51 85.28
4-Feb-15 34672.25 87.14
6-Feb-15 34656.94 88.76
9-Feb-15 34570.30 92.17
10-Feb-15 34432.89 90.60
11-Feb-15 34203.99 86.27
12-Feb-15 33786.42 84.66
13-Feb-15 33943.20 84.76
16-Feb-15 33796.44 83.03
17-Feb-15 33801.10 83.97
18-Feb-15 33718.86 83.98
19-Feb-15 33942.27 84.95
20-Feb-15 33993.00 85.04
23-Feb-15 33926.70 84.36
24-Feb-15 33895.46 84.39
25-Feb-15 33845.30 84.13
26-Feb-15 33762.80 84.29
27-Feb-15 33632.19 85.82
2-Mar-15 33213.58 86.16
3-Mar-15 33188.77 87.05
4-Mar-15 33242.94 87.44
5-Mar-15 33368.83 87.36
6-Mar-15 33263.66 87.46
9-Mar-15 32860.57 86.71
10-Mar-15 32566.59 84.03
11-Mar-15 32539.61 83.75
12-Mar-15 32582.68 80.64
13-Mar-15 32929.09 81.62
16-Mar-15 32454.91 80.01
17-Mar-15 32342.26 80.94
18-Mar-15 31524.98 79.70
19-Mar-15 31451.62 80.35
20-Mar-15 31800.26 82.30
24-Mar-15 31310.73 79.68
25-Mar-15 31086.51 78.13
26-Mar-15 30678.97 78.19
27-Mar-15 29957.83 75.12
30-Mar-15 28927.04 73.47
31-Mar-15 30233.87 77.14
1-Apr-15 30605.05 79.98
2-Apr-15 31132.25 80.90
3-Apr-15 31413.96 82.62
6-Apr-15 31752.17 83.75
7-Apr-15 31600.73 83.99
8-Apr-15 31887.30 85.20
9-Apr-15 32013.91 85.06
10-Apr-15 32350.93 86.15
13-Apr-15 32248.45 85.90
14-Apr-15 32109.87 80.80
15-Apr-15 32248.86 81.20
16-Apr-15 32736.43 83.59
17-Apr-15 33234.73 85.06
20-Apr-15 33304.64 82.95
21-Apr-15 33035.77 84.48
22-Apr-15 33490.64 83.25
23-Apr-15 33456.74 82.74
24-Apr-15 33775.12 83.52
27-Apr-15 33844.29 83.21
28-Apr-15 33575.94 85.11
29-Apr-15 33460.01 84.55
30-Apr-15 33729.96 87.03
4-May-15 33723.53 88.73
5-May-15 33533.64 86.81
6-May-15 33839.28 85.95
7-May-15 33742.88 85.74
8-May-15 33530.30 85.27
11-May-15 32506.36 82.15
12-May-15 33023.80 85.11
13-May-15 32915.44 84.17
14-May-15 33103.73 85.12
15-May-15 33039.19 85.16
18-May-15 32886.06 84.96
19-May-15 32729.55 84.32
20-May-15 32599.00 84.95
21-May-15 32617.74 84.14
22-May-15 32605.62 83.92
25-May-15 32707.22 84.96
26-May-15 32510.35 84.13
27-May-15 32842.59 84.59
28-May-15 32763.48 84.14
29-May-15 33056.79 83.89
1-Jun-15 33563.38 85.73
2-Jun-15 33895.34 86.85
3-Jun-15 33908.62 86.85
4-Jun-15 34085.74 87.49
5-Jun-15 34012.49 87.39
8-Jun-15 34151.11 88.13
9-Jun-15 34270.28 89.58
10-Jun-15 34323.84 90.79
11-Jun-15 34594.70 91.26
12-Jun-15 34651.29 90.95
15-Jun-15 34710.29 89.44
16-Jun-15 34516.30 88.37
17-Jun-15 34482.00 89.54
18-Jun-15 34674.61 90.12
19-Jun-15 34526.70 89.49
22-Jun-15 34278.42 87.61
23-Jun-15 34133.83 87.71
24-Jun-15 34331.94 87.99
25-Jun-15 34077.92 88.05
26-Jun-15 33885.13 87.58
29-Jun-15 34093.55 88.23
30-Jun-15 34398.86 88.69
1-Jul-15 34843.60 89.94
2-Jul-15 35186.56 92.72
3-Jul-15 35456.35 92.57
6-Jul-15 35502.28 94.07
7-Jul-15 35537.69 94.72
8-Jul-15 35328.83 93.23
9-Jul-15 35147.13 91.61
10-Jul-15 35112.29 91.75
13-Jul-15 35496.62 93.72
14-Jul-15 35446.89 94.36
15-Jul-15 35699.75 94.89
16-Jul-15 35887.66 94.79
22-Jul-15 36056.68 95.99
23-Jul-15 35934.99 94.81
24-Jul-15 35815.20 94.25
27-Jul-15 35175.49 91.50
28-Jul-15 35274.66 93.98
29-Jul-15 35676.49 93.04
30-Jul-15 35730.01 93.88
31-Jul-15 35741.52 92.97
3-Aug-15 35824.56 94.40
4-Aug-15 35921.71 96.13
5-Aug-15 36156.83 97.92
6-Aug-15 36228.88 98.23
7-Aug-15 36222.63 98.51
10-Aug-15 36084.67 98.87
11-Aug-15 36205.94 98.06
12-Aug-15 35892.77 96.80
13-Aug-15 35937.33 96.89
17-Aug-15 35588.05 96.49
18-Aug-15 35546.03 96.68
19-Aug-15 35461.58 96.60
20-Aug-15 35219.59 95.06
21-Aug-15 34519.77 93.86
24-Aug-15 33100.34 89.17
25-Aug-15 33798.80 93.62
26-Aug-15 33537.42 92.69
27-Aug-15 33961.29 94.24
28-Aug-15 34447.47 95.46
31-Aug-15 34726.51 95.05
1-Sep-15 34456.34 97.38
2-Sep-15 34309.76 99.35
3-Sep-15 34397.33 98.62
4-Sep-15 33891.08 97.69
7-Sep-15 32944.48 94.28
8-Sep-15 33474.17 96.39
9-Sep-15 33830.36 96.06
10-Sep-15 33792.37 95.75
11-Sep-15 33672.72 94.41
14-Sep-15 33384.73 93.22
15-Sep-15 33191.46 91.97
16-Sep-15 33345.56 93.20
17-Sep-15 33152.06 93.29
18-Sep-15 32760.95 92.26
21-Sep-15 32826.24 91.51
22-Sep-15 32882.02 92.76
23-Sep-15 32822.84 92.27
28-Sep-15 32690.02 92.11
29-Sep-15 32214.58 90.35
30-Sep-15 32287.41 89.80
1-Oct-15 32750.31 92.06
2-Oct-15 32969.73 92.29
5-Oct-15 32784.94 92.01
6-Oct-15 33202.87 93.09
7-Oct-15 33376.20 91.42
8-Oct-15 33469.15 92.08
9-Oct-15 33843.18 92.47
12-Oct-15 34183.85 92.24
13-Oct-15 34031.78 91.79
14-Oct-15 33974.85 91.96
15-Oct-15 33921.96 92.04
16-Oct-15 33954.98 91.27
19-Oct-15 33966.75 92.78
20-Oct-15 33910.17 91.60
21-Oct-15 33943.74 91.35
22-Oct-15 33945.32 90.37
26-Oct-15 33860.64 90.00
27-Oct-15 33843.83 90.73
28-Oct-15 34061.42 90.93
29-Oct-15 34332.43 92.33
30-Oct-15 34261.60 91.51
2-Nov-15 34226.12 90.01
3-Nov-15 34275.75 89.56
4-Nov-15 34522.95 89.50
5-Nov-15 34454.59 89.39
6-Nov-15 34426.75 85.81
9-Nov-15 34336.47 85.48
10-Nov-15 33958.12 84.71
11-Nov-15 33934.04 83.98
12-Nov-15 34264.56 85.82
13-Nov-15 34144.78 84.88
16-Nov-15 33946.41 84.01
17-Nov-15 34065.87 84.16
18-Nov-15 33949.26 84.38
19-Nov-15 33908.44 84.30
20-Nov-15 33857.00 84.04
23-Nov-15 33732.91 83.83
24-Nov-15 33571.59 83.90
25-Nov-15 33199.86 83.28
26-Nov-15 33079.37 82.44
27-Nov-15 32960.27 82.30
30-Nov-15 32255.20 81.44
1-Dec-15 31709.36 80.45
2-Dec-15 32392.92 81.62
3-Dec-15 32565.14 81.45
4-Dec-15 32707.91 81.49
7-Dec-15 32853.54 85.56
8-Dec-15 32791.71 84.47
9-Dec-15 33020.26 86.15
10-Dec-15 33211.92 85.70
11-Dec-15 33048.51 84.18
14-Dec-15 32757.82 82.50
15-Dec-15 32467.04 81.03
16-Dec-15 32714.60 81.51
 17-Dec-15 33109.54 83.53
18-Dec-15 32777.04 83.55
21-Dec-15 32658.97 83.16
22-Dec-15 32641.09 84.54
23-Dec-15 32500.75 83.49
28-Dec-15 32674.04 83.87
29-Dec-15 32811.89 83.98
30-Dec-15 32825.03 83.87
31-Dec-15 32816.31 84.13
1-Jan-16 33228.95 85.83
4-Jan-16 33009.13 85.31
5-Jan-16 32983.47 84.38
6-Jan-16 32968.26 85.42
7-Jan-16 32682.50 84.88
8-Jan-16 32534.85 84.81
11-Jan-16 32320.05 84.70
12-Jan-16 32265.65 83.90
13-Jan-16 32154.17 83.56
14-Jan-16 31441.02 81.07
15-Jan-16 31001.49 80.50
18-Jan-16 30628.40 78.70
19-Jan-16 31092.61 79.26
20-Jan-16 30766.01 77.01
21-Jan-16 30751.80 77.62
22-Jan-16 30949.02 77.69
25-Jan-16 31065.13 77.98
26-Jan-16 31074.38 78.81
27-Jan-16 31101.38 80.37
28-Jan-16 31193.73 79.32
29-Jan-16 31298.60 79.81
1-Feb-16 31878.15 80.98
2-Feb-16 31960.61 79.14
3-Feb-16 32084.06 78.62
4-Feb-16 32478.98 81.15
8-Feb-16 32706.22 81.11
9-Feb-16 32444.20 78.99
10-Feb-16 32144.59 78.16
11-Feb-16 31820.54 77.49
12-Feb-16 31464.16 76.24
15-Feb-16 31928.15 77.03
16-Feb-16 31673.16 76.03
17-Feb-16 31469.70 75.39
18-Feb-16 31282.44 71.77
19-Feb-16 31011.77 69.09
22-Feb-16 30677.68 68.54
23-Feb-16 30564.50 68.40
24-Feb-16 30786.60 70.24
25-Feb-16 30802.53 71.30
26-Feb-16 31294.08 72.41
29-Feb-16 31369.51 75.32
1-Mar-16 31509.11 75.66
2-Mar-16 31772.90 74.84
3-Mar-16 32146.58 75.56
4-Mar-16 32441.74 77.15
7-Mar-16 33022.60 77.46
8-Mar-16 33032.85 77.82
9-Mar-16 32957.98 77.45
10-Mar-16 32710.56 76.36
11-Mar-16 32669.16 75.69
14-Mar-16 32738.56 72.23
15-Mar-16 32623.02 71.34
16-Mar-16 32891.08 70.95
17-Mar-16 32957.75 69.08
18-Mar-16 33080.40 69.56
21-Mar-16 33022.87 70.09
22-Mar-16 32928.30 69.51
24-Mar-16 32801.88 69.39
25-Mar-16 32876.55 68.61
28-Mar-16 32904.32 69.01
29-Mar-16 32879.67 68.76
30-Mar-16 32922.40 69.09
31-Mar-16 33139.00 69.49
1-Apr-16 33449.62 70.28
4-Apr-16 33808.42 71.33
5-Apr-16 33766.49 71.02
6-Apr-16 33946.37 72.07
7-Apr-16 33896.03 72.36
8-Apr-16 33967.54 72.41
11-Apr-16 33566.22 71.02
12-Apr-16 33616.90 71.10
13-Apr-16 33646.10 71.60
14-Apr-16 33767.59 73.19
15-Apr-16 33767.12 72.96
18-Apr-16 33759.97 71.29
19-Apr-16 33729.62 71.50
20-Apr-16 33619.84 70.82
21-Apr-16 33572.13 68.98
22-Apr-16 33739.54 69.19
25-Apr-16 33684.56 69.32
26-Apr-16 33847.74 69.48
27-Apr-16 34269.28 70.09
28-Apr-16 34503.64 70.47
29-Apr-16 34719.29 70.00
2-May-16 34567.52 69.69
3-May-16 34897.30 69.38
4-May-16 35317.56 69.02
5-May-16 35941.47 69.31
6-May-16 35973.68 70.09
9-May-16 36234.99 69.98
10-May-16 36265.12 69.98
11-May-16 36266.23 70.21
12-May-16 36048.76 70.05
13-May-16 36122.49 70.31
16-May-16 36125.37 69.44
17-May-16 36137.12 68.91
18-May-16 36318.21 69.29
19-May-16 36685.05 70.01
20-May-16 36693.50 70.91
23-May-16 36723.35 72.11
24-May-16 36582.35 71.93
25-May-16 36499.43 71.55
26-May-16 36540.97 71.00
27-May-16 36694.26 70.69
30-May-16 36234.69 69.56
31-May-16 36061.56 69.56
1-Jun-16 36496.16 69.76
2-Jun-16 36839.14 69.54
3-Jun-16 37223.00 68.91
6-Jun-16 37352.27 70.11
7-Jun-16 37392.29 68.35
 8-Jun-16 37426.39 67.61
9-Jun-16 37414.26 67.65
10-Jun-16 36940.88 66.53
13-Jun-16 36979.96 66.93
14-Jun-16 37517.75 67.48
15-Jun-16 38559.87 68.07
16-Jun-16 38751.60 67.57
17-Jun-16 38776.94 66.58
20-Jun-16 38469.82 66.14
21-Jun-16 38415.31 65.89
22-Jun-16 38149.26 65.12
23-Jun-16 38237.89 65.25
24-Jun-16 37389.88 63.73
27-Jun-16 37039.57 63.82
28-Jun-16 37076.63 63.85
29-Jun-16 37786.57 64.77
30-Jun-16 37783.54 64.48
4-Jul-16 37966.76 64.52
11-Jul-16 38367.96 65.58
12-Jul-16 39031.62 66.36
13-Jul-16 39049.46 66.03
14-Jul-16 39257.00 65.96
15-Jul-16 39188.47 66.66
18-Jul-16 39253.25 66.38
19-Jul-16 39208.88 66.94
20-Jul-16 39098.79 67.97
21-Jul-16 39306.79 69.41
22-Jul-16 39151.78 68.64
25-Jul-16 39017.32 67.93
26-Jul-16 39147.33 68.49
27-Jul-16 39434.97 68.74
28-Jul-16 39468.98 68.24
29-Jul-16 39528.82 68.60
1-Aug-16 39800.64 68.57
2-Aug-16 39786.93 67.90
3-Aug-16 39615.76 67.38
4-Aug-16 39446.70 67.66
5-Aug-16 39390.21 67.73
8-Aug-16 39476.17 67.52
9-Aug-16 39663.71 68.09
10-Aug-16 39805.88 68.60
11-Aug-16 39861.60 68.85
12-Aug-16 39907.64 69.21
15-Aug-16 40030.52 69.40
16-Aug-16 40050.17 69.39
17-Aug-16 40057.52 68.74
18-Aug-16 39771.20 68.49
19-Aug-16 39499.08 67.56
22-Aug-16 39457.95 67.51
23-Aug-16 39400.19 67.57
24-Aug-16 39506.58 67.58
25-Aug-16 39792.10 67.96
26-Aug-16 39926.70 67.53
29-Aug-16 40023.02 67.87
30-Aug-16 39991.79 67.74
31-Aug-16 39809.58 67.62
1-Sep-16 39738.67 67.88
2-Sep-16 39464.65 67.37
5-Sep-16 39278.11 66.80
6-Sep-16 39688.97 66.70
 7-Sep-16 40084.87 66.65
8-Sep-16 40136.93 66.08
9-Sep-16 40340.23 66.00
15-Sep-16 40216.35 66.06
16-Sep-16 40363.68 64.81
19-Sep-16 40414.72 64.94
20-Sep-16 40340.46 64.56
21-Sep-16 39771.42 63.46
22-Sep-16 40135.31 63.74
23-Sep-16 39781.95 62.26
26-Sep-16 40220.76 63.31
27-Sep-16 40294.38 62.36
28-Sep-16 40355.02 62.09
29-Sep-16 40295.52 61.72
30-Sep-16 40541.81 61.66
3-Oct-16 40986.31 62.47
4-Oct-16 41123.97 62.17
5-Oct-16 41253.46 62.45
6-Oct-16 41252.17 62.08
7-Oct-16 41200.48 61.48
10-Oct-16 41403.97 61.67
13-Oct-16 41412.04 61.75
14-Oct-16 41464.31 62.04
17-Oct-16 41282.72 62.32
18-Oct-16 40954.22 61.65
19-Oct-16 40924.14 61.45
20-Oct-16 41545.95 63.03
21-Oct-16 41291.43 62.45
24-Oct-16 40852.03 61.98
25-Oct-16 40764.76 63.16
26-Oct-16 40526.81 63.75
27-Oct-16 39987.31 62.83
28-Oct-16 39872.88 63.15
31-Oct-16 39893.84 63.50
1-Nov-16 41299.87 65.16
2-Nov-16 41742.75 64.69
3-Nov-16 41974.46 64.41
4-Nov-16 41841.56 63.90
7-Nov-16 42133.54 64.43
8-Nov-16 42113.91 64.08
9-Nov-16 42203.63 64.03
10-Nov-16 42703.99 64.38
11-Nov-16 42849.12 63.96
14-Nov-16 42525.93 63.12
15-Nov-16 42292.67 63.05
16-Nov-16 42404.47 63.06
17-Nov-16 42411.80 62.81
18-Nov-16 42324.94 62.80
21-Nov-16 42439.04 62.74
22-Nov-16 42631.58 62.96
23-Nov-16 42901.02 63.24
24-Nov-16 42949.73 64.00
25-Nov-16 42999.66 64.60
28-Nov-16 43060.71 65.71
29-Nov-16 42811.27 64.97
30-Nov-16 42622.37 64.43
1-Dec-16 42907.36 64.95
2-Dec-16 43270.90 65.53
5-Dec-16 43739.97 67.74
6-Dec-16 44199.40 68.51
 7-Dec-16 44494.99 69.43
8-Dec-16 44741.98 66.70
9-Dec-16 45387.23 68.24
13-Dec-16 45857.89 67.95
14-Dec-16 46185.27 67.42
15-Dec-16 46358.35 66.73
16-Dec-16 46584.53 65.77
19-Dec-16 46938.59 65.58
20-Dec-16 47210.06 65.47
21-Dec-16 46993.31 65.04
22-Dec-16 46699.78 65.25
23-Dec-16 46633.99 65.41
26-Dec-16 46689.73 65.86
27-Dec-16 46920.47 66.22
28-Dec-16 47424.63 67.47
29-Dec-16 47666.66 68.29
30-Dec-16 47806.97 67.98

Source: Bloomberg
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Exhibit 8: Cost of Capital Estimation Report

Engro Fertilizers is financed through both debt and equity. Therefore, the weighted average cost of capital (WACC) method is appropriate fo
the company. To calculate the WACC, the appropriate weights of debt and equity, the cost of debt and cost of equity are required. Followin
are the detailed steps:

Estimating the weights

I have used the following balance sheet data to estimate the weights of debt and equity:
Capital sources
Debt:
Short term borrowings
Long term borrowings

Equity:

As per the above data, the weight of debt (wd) is 0.47 and that of equity (we) is 0.53.

Cost of Debt, kd
To estimate the cost of debt, I have divided the interest expense for 2016 by the total debt of the company. The cost of debt is 8.53%.

Cost of Equity, ke
For the cost of equity, I have used the capital asset pricing model (CAPM). Yield on the 12-month market treasury bill, 5.9489%, is assume
to be the risk free rate andthe risk premium is 6%, as indicated by you. Since the beta of Engro Fertilizers is not given, I used the beta of it
closest competitor, Fauji Fertilizers, in my calculations. It is 0.86. Putting all the numbers in the CAPM equation:

Cost of equity = ke = Rf + (Beta * Risk Premium)

ke = 5.9489% + (0.86 * 6%)
ke = 11.11%.

Cost of Capital - WACC

Using the WACC formula:
WACC = (kd * we) + (Ke* we)
= (8.53% * 0.47) + (11.11% * 0.53)
= 9.90%

Hence, the weighted average cost of capital of Engro Fertilizers is 9.9%.

Source: Case Writers’ Notes

 y. Therefore, the weighted average cost of capital (WACC) method is appropriate for
weights of debt and equity, the cost of debt and cost of equity are required. Following

he weights of debt and equity:

Book values (million PKR)

7,081
29,380
36,461 ---- 47% of total capital

41,648 ---- 53% of total capital

d that of equity (we) is 0.53.

xpense for 2016 by the total debt of the company. The cost of debt is 8.53%.

ng model (CAPM). Yield on the 12-month market treasury bill, 5.9489%, is assumed
dicated by you. Since the beta of Engro Fertilizers is not given, I used the beta of its
t is 0.86. Putting all the numbers in the CAPM equation:

tilizers is 9.9%.
Exhibit 9: Assumptions for Discounted Cash Flow Analysis

CY17F CY18F CY19F CY20F CY21F

Revenue growth 7% -1% 5% 3% 3%

Gross margin 30% 31% 31% 31% 30%
Operating margin 19% 20% 20% 19% 17%
Tax rate 22% 24% 23% 24% 25%
Dep & Amort/sales 2% 5% 4% 4% 3%
Capex as % of sales 0.1% 0.1% 0.1% 0.1% 0.1%
Current assets/sales 48% 48% 48% 48% 48%
Current liabilities/sales 52% 52% 52% 52% 52%

Source: Case Writers' Notes

CY22F CY23F CY24F CY25F CY26F

3% 4% 3% 2% 2%
30% 30% 29% 21% 18%
17% 17% 17% 10% 8%
25% 25% 24% 19% 14%
3% 3% 3% 2% 2%
0.1% 0.1% 0.1% 0.1% 0.1%
48% 48% 48% 48% 48%
52% 52% 52% 52% 52%