THE INVESTORS ARE ADVISED IN THEIR OWN INTEREST TO … · 2012-06-01 · Bidding Process Starting...

THE BOOKBUILDING PORTION COMPRISING OF 20 MILLION ORDINARY SHARES HAS BEEN SUCCESSFULLY CLOSED.

THE PRESENT ISSUE OF 10 MILLION ORDINARY SHARES IS BEING MADE TO THE GENERAL PUBLIC AT A PRICE OF PKR

10.00 PER ORDINARY SHARES (I.E. STRIKE PRICE DETERMINED THROUGH BOOK BUILDING).

TPL TRAKKER LIMITED (Incorporated under the Companies Ordinance, 1984)

P R O S P E C T U S

FOR ISSUE OF 30,000,000 ORDINARY SHARES (13.8 % OF THE POST ISSUE PAID UP

CAPITAL) OF FACE VALUE OF PKR 10.00 EACH

BOOK BUILDING PORTION OF THE ISSUE COMPRISES OF 20 MILLION ORDINARY

SHARES (66.7% OF THE TOTAL ISSUE) AT A FLOOR PRICE OF PKR 10 PER SHARE

GENERAL PUBLIC PORTION OF THE ISSUE COMPRISES OF 10 MILLION ORDINARY

SHARES (33.3% OF THE ISSUE) AT PKR 10.00 PER SHARE

BIDDING PERIOD DATES: FROM 02/5/2012 TO 03/05/2012

(BOTH DAYS INCLUSIVE) DURING BANKING HOURS

DATE OF PUBLIC SUBSCRIPTION: FROM 05/06/2012 TO 06/06/2012

(BOTH DAYS INCLUSIVE) DURING BANKING HOURS

JOINT LEAD MANAGERS AND ARRANGERS

AKD SECURITES LIMITED

JOINT BOOK RUNNERS

AKD SECURITES LIMITED

BOOK BUILDING PORTION

UNDERWRITTEN BY:

- AKD SECURITIES LIMITED

- ARIF HABIB LIMITED

GENERAL PUBLIC PORTION UNDERWRITTEN

BY :

- NATIONAL BANK OF PAKISTAN

- AKD SECURITIES LIMITED

- INVEST CAPITAL MARKETS LIMITED

- PAIR INVESTMENT COMPANY LIMITED

The date of publication of this Prospectus is 23-05-2012

ADVICE FOR GENERAL PUBLIC

INVESTORS ARE STRONGLY ADVISED IN THEIR OWN INTEREST TO CAREFULLY READ THE CONTENTS OF

THIS PROSPECTUS, ESPECIALLY THE RISK FACTORS GIVEN AT SECTION 5.7 BEFORE MAKING ANY

INVESTMENT DECISION

SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN ONE APPLICATIONS BY SAME

PERSON) IS PROHIBITED AND SUCH APPLICATIONS’ MONEY IS LIABLE TO CONFISCATION UNDER

SECTION 18A OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969

ADVICE FOR INSTITUTIONAL INVESTORS AND HIGH NETWORTH INDIVIDUAL INVESTORS

A SINGLE INVESTOR CANNOT SUBMIT MORE THAN ONE BIDDING APPLICATION EXCEPT IN THE CASE OF

REVISION OF BID. IF AN INVESTOR SUBMITS MORE THAN ONE BIDDING APPLICATION THEN ALL SUCH

APPLICATIONS SHALL BE SUBJECT TO REJECTION.

Statements on Issuer’s absolute responsibility:

The Issuer, having made all reasonable inquiries, accepts responsibility for the disclosures

made in this prospectus and confirms that:

this prospectus contains all information with regard to the issuer and the issue,

which is material in the context of the issue and nothing has been concealed;

the information contained in the prospectus is true and correct to the best of our

knowledge and belief;

the opinions and intentions expressed herein are honestly held; and

there are no other facts, the omission of which make this document as a whole or

any part thereof misleading.”

S/d

______________________

Mohammad Ali Jameel

Chief Executive Officer

GLOSSARY OF TECHNICAL TERMS

AB Group Ali Bhai Group

ACPF Asia Crime Prevention Foundation

AED Arab Emirates Dirham

AHL Arif Habib Limited

AJ Group Ali Jameel Group

AKDS AKD Securities Limited

APTTA Afghan-Pak Transit Trade Agreement

ATM Automated Teller Machine

BPO Business Process Outsourcing

CCR Central Control Room

CDA Central Depository Act, 1997

CDC / CDCPL Central Depository Company of Pakistan Ltd.

CDC Regulations Central Depository Company of Pakistan Ltd. Regulations

CDS Central Depository System

CMMS Computerized Maintenance Management Systems

CMS Centre Point Management Services (Pvt.) Limited

CNIC Computerized National Identity Card

Commission The Securities and Exchange Commission of Pakistan

Company / TPL Trakker / TPL / Issuer TPL Trakker Limited

CPLC Citizen Police Liaison Committee

CRM Customer Relationship Management

CRO Company Registration Office

DL Digicore International (Pty) Limited

EAC Economic Advisory Council

EBITDA Earnings before interest, tax, depreciation and amortization

ETA Estimated Time of Arrival

EVAC EVAC Pakistan (Pvt.) Limited

FBR Federal Board of Revenue

FFFP Fellowship Fund For Pakistan

FIGs Financial Institutions Groups

FMS Fleet Management Solutions

FPCCI Federation of Pakistan Chambers of Commerce

GLONASS Global Navigation Satellite System

GNSS Global Navigation Satellite System

GoP Government of Pakistan

GPRS General Packet Radio Service

GPS Global Position Systems

Group

Group includes TPL Trakker Limited, TPL Direct Insurance

Limited, TPL Security Services (Pvt) Limited, Trakker

Middle East LLC, TPL Properties (Pvt) Limited and EVAC

Pakistan (Pvt) Limited

HNWI High Net Worth Individual

ICAP Institute of Chartered Accountants of Pakistan

IDN In-Dash Navigation

IPO Initial Public Offering

ISE Islamabad Stock Exchange

Issue Initial Offering of Shares by the Company

ITO Income Tax Ordinance, 2001

IVMS In Vehicle Monitoring Systems

Joint BR Joint Book Runners

Joint Lead Managers & Arrangers AKD Securities Limited

KIBOR Karachi Inter-Bank Offered Rate

KPT Karachi Port Trust

KSE Karachi Stock Exchange (Guarantee) Limited

LSE Lahore Stock Exchange (Guarantee) Limited

MIS Management Information System

MNCs Multinational Companies

NBP National Bank of Pakistan

NICOP National Identity Card for Overseas Pakistanis

NOCs No Objection Certificates

OEM Original Equipment Manufacturer

OPIC Overseas Private Investment Corporation

Ordinance The Companies Ordinance, 1984

PACRA The Pakistan Credit Rating Agency Limited

PAMA Pakistan Automotive Manufacturers Association

PKR Pakistan Rupee(s)

PMCL Pakistan Mobile Communications Limited

PND Personal Navigation Device

PSQCA Pakistan Standards & Quality Control Authority

PTA Pakistan Telecommunication Authority

PTML Pakistan Telecom Mobile Limited

SCRA Special Convertible Rupee Account

SECP Securities and Exchange Commission of Pakistan

SMS Short Messaging Service

TCR Trakker Control Room

TDI TPL Direct Insurance Limited

TEU Twenty-Foot Equivalent Unit

TME Trakker Middle East

TRG The Resource Group

TSS TPL Security Services (Pvt) Limited

TTPL TPL Trakker (Private) Limited

VMS Vehicle Management System

WHT Withholding Tax

WWC Woodrow Wilson International Centre for Scholars.

Definitions

Application Money In case of bidding for shares out of the book building

portion, the total amount of money payable by a

successful bidder which is equivalent to the product

of the strike price and the number of shares to be

allotted.

AND

In case of application for subscription of shares out

of the general public portion, the amount of money

paid along with application for subscription of shares

which is equivalent to the product of the offer price

and the number of shares applied for.

Bid An indication to make an offer during the bidding

period by a bidder to subscribe to the Ordinary

Shares of TPL Trakker Limited at or above the floor

price, including all the revisions thereto.

Bidder Any eligible prospective investor who makes a bid

pursuant to the terms of the Preliminary Prospectus

and the Bidding Form.

Bid Amount The total amount of the bid which is equivalent to

the product of the bid price and the number of shares

bid for.

Bid Collection Centre Pre-determined places where applications for

bidding of shares are collected by the Joint Book

Runners on behalf of the Issuer and may include

offices of Corporate Brokerage Houses, Schedule

Banks, Development Financial Institutions and

Investment Finance Companies, subject to

appointment of these institutions as agent by the

Joint Book Runners through an agreement in writing

for the purpose, with the consent of the Issuer.

Bidding Form The form prepared by the Issuer on the format

mentioned in the Listing Regulations of the

Exchange for the purpose of making bids which will

be considered as the application for subscription of

Ordinary Shares out of the book building portion.

Bidding Period The period during which bids for shares of the

Company shall be made by Institutional Investors

and HNWI Investors. The Bidding Period

commences on May 2nd

, 2012 and ends on May 3rd

,

2012 (daily from 9:00 a.m. to 5:00 p.m.)

Bidding Process Ending Date The date after which Joint Book Runners will not

accept any bid for the book building portion of the

issue.

Bidding Process Starting Date The date on which Joint Book Runners shall start

accepting bids for the book building portion of the

issue

Book Building A mechanism of price determination through which

indication of interest for subscription of shares

offered by the Issuer is collected from Institutional

Investors and HNWI Investors. Through this process

a book is built which gives an idea of demand for the

shares at different price levels. The strike price is

determined based on the price at which demand for

shares at the end of book building period is sufficient

to raise the required amount.

Book Building Account An account opened by the Issuer with the Collection

Bank(s). The bidder will pay the margin money/bid

amount through demand draft, pay order or cheque

in favor of this account and the balance of the

application money, if any, shall be paid through this

account after successful allocation of shares.

Joint Book Runners AKD Securities Limited & Arif Habib Limited

Company Legal Advisor Mohsin Tayebaly & Co

Final Prospectus A document containing all the information and

disclosures as required under the Companies

Ordinance, 1984 together with disclosure of the

strike price, results of the Book Building process, the

date of publication of Prospectus and the date(s) for

subscription of shares out of the general public

portion.

Floor Price The minimum price set by the Issuer for the Issue of

shares which is PKR 10 per share. A bid placed

below the floor price will not be entertained by the

Joint Book Runners.

General Public All individual and institutional investors including

both Pakistani (residents & non-residents) and

foreign investors.

General Public Issue Price The price at which ordinary shares of the Company

are issued to the general public. This price can be at

or below the strike price.

High Net worth Individual (HNWI) Individual investor who applies or bids for shares of

the value of PKR 1,000,000/- or above in the book

building process.

Institutional Investors Both local and foreign institutional investors.

Joint Lead Managers and Arrangers National Bank of Pakistan, AKD Securities

Limited & Arif Habib Limited

Limit Price The maximum price a prospective institutional

investor or HNWI Investor is willing to pay for a

share under the Book Building process.

Margin Money The partial or total amount, as the case may be, paid

by a bidder at the time of making a bid.

Ordinary Shares Ordinary Shares of TPL Trakker Limited having face

value of PKR10 each unless otherwise specified in

the context thereof.

Preliminary Prospectus The preliminary Prospectus containing all the

information and disclosures as required under the

Companies Ordinance, 1984, and Listing Regulation

of the Stock Exchange approved by the Commission

under section 57(1) of the Companies Ordinance,

1984 and circulated amongst the Institutional

Investors and HNWI Investors for bidding of shares

out of the book building portion through the Book

Building Process.

Strike Order A bid for a specified number of shares at the strike

price to be determined through the Book Building

process

Strike Price The price of share determined/discovered on the

basis of book building process in the manner

provided in the Listing Regulations of KSE at which

the shares are issued to the successful bidders. The

Strike Price determined through the Book Building

Process is PKR 10.00 per share

TABLE OF CONTENTS

PART Content Page No.

1. Approvals and Listing on the Stock Exchange Page 1

2. Book Building Procedure Page 3

3. Share Capital and Related Matters Page 18

4. Underwriting, Commissions, Brokerage and other Expenses Page 28

5. Overview, History and Prospects Page 30

6. Financial Information Page 57

7. Management Page 78

8. Miscellaneous Information 6

9. Application and Transfer Instructions Page 93

10. Application Form Page 97

11. Signatories to the Prospectus Page 98

12. Memorandum of Association Page 99

Prospectus – TPL Trakker Limited

1

PART 1

1. APPROVALS AND LISTING ON THE STOCK EXCHANGE

1.1 APPROVAL OF THE SECURITIES & EXCHANGE COMMISSION OF

PAKISTAN

Approval of the Securities & Exchange Commission of Pakistan (the "Commission" or the

"SECP") as required under Section 57(1) of the Companies Ordinance, 1984 (the

"Ordinance") has been obtained by TPL Trakker Limited (“TPL or “the Company”) for the

issue, circulation and publication of this Prospectus.

DISCLAIMER:

It must be distinctly understood that in giving this approval, SECP does not take any

responsibility for the financial soundness of the Company and any of its schemes

stated herein or for the correctness of any of the statements made or opinions

expressed with regard to them by the company in this prospectus.

SECP has not evaluated quality of the issue and its approval for issue, circulation

publication of the Prospectus should not be construed as any commitment of the same.

The public/investors should conduct their own independent due diligence and analysis

regarding the quality of the issue before bidding/subscribing.

1.2 CLEARANCE OF THE PROSPECTUS BY THE KARACHI STOCK EXCHANGE

(GUARANTEE) LIMITED.

The Prospectus has been cleared by the Karachi Stock Exchange (Guarantee) Limited, in

accordance with the requirements of the Listing Regulations.

DISCLAIMER:

The KSE has not evaluated the quality of the issue and its clearance should not be

construed as any commitment of the same. The public / investors should conduct

their own independent investigation and analysis regarding the quality of the issuer

before subscribing.

The publication of this document does not represent solicitation by the Karachi

Stock Exchange.

The contents of this document do not constitute an invitation to invest in Shares or

subscribe for any securities or other financial instrument by the Karachi Stock

Exchange, nor should it or any part of it form the basis of, or be relied upon in any

connection with any contract or commitment whatsoever of the Exchange.

It is clarified that Information in this prospectus should not be construed as advice

on any particular matter by the Karachi Stock Exchange and must not be treated as

a substitute for specific advice.

The Karachi Stock Exchange disclaims any liability whatsoever for any loss

howsoever arising from or in reliance upon this document to any one, arising from

any reason, including, but not limited to, inaccuracies, incompleteness and/or

mistakes, for decisions and/or actions taken, based on this document.

The Karachi Stock Exchange neither takes responsibility for the correctness of

contents of this document nor the ability of the Company to fulfill its obligations

thereunder.


2

Advice from a suitably qualified professional should always be sought by investors

in relation to any particular investment.

1.3 FILING OF THE PROSPECTUS AND OTHER DOCUMENTS WITH THE

REGISTRAR OF COMPANIES

The Company has filed with the Registrar, Companies Registration Office Karachi, as

required under Section 57(3) and (4) of the Companies Ordinance 1984, a copy of this

Prospectus signed on behalf of the Company, along with the following documents attached

thereto:

a) Letter dated 09 March 2012 from the Auditors of the Company, Ernst & Young

Ford Rhodes Sidat Hyder, Chartered Accountants, consenting to the publication of

their names in the Prospectus, which contains in Part 6 certain statements and

reports issued by them as experts (for which consent has not been withdrawn), as

required under Section 57(5) of the Companies Ordinance 1984.

b) Copies of Material Contracts and Agreements mentioned in Part 8 of this

Prospectus as required under Section 57(4) of the Ordinance.

c) Written confirmations of the Legal Advisor to this issue and Bankers to this issue,

mentioned in this Prospectus consenting to act in their respective capacities, as

required under Section 57(5) of the Companies Ordinance, 1984.

d) Consents of the Directors, the Chief Executive and the Company Secretary of the

Company who have consented to their respective appointments being made and

their having been named or described as such Directors and Chief Executive in this

Prospectus, as required under Section 57(3) of the Ordinance, read with sub-clause

(1) of clause (4) of Section 1 of Part 1 of the Second Schedule to the Ordinance.

1.4 LISTING AT THE KARACHI STOCK EXCHANGE

An Application has been made to the KSE for permission to deal in and for quotation of the

shares of the Company.

If for any reason, the application for formal listing is not accepted by KSE, the Company

undertakes that a notice to that effect will immediately be published in the press and

thereafter the Issuer undertakes to refund the application money to the applicants as

required by the provisions of Section 72 of the Ordinance.

1.5 CERTIFICATE BY CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL

OFFICER OF THE ISSUER

“We being the Chief Executive Officer and Chief Financial Officer of the Company certify

that the prospectus constitutes full, true and plain disclosures of all material facts relating to

the shares being offered through this prospectus and that nothing has been concealed.

The information provided and disclosures made in this prospectus contain no misleading

material.

-Sd- -Sd-

__________________ __________________

Mr. Mohammad Ali Jameel Mr. Adnan Khandwala

Chief Executive Officer, Chief Financial Officer

TPL Trakker Limited TPL Trakker Limited


3

PART 2

2. BOOK BUILDING PROCEDURE

2.1 BRIEF ISSUE STRUCTURE

The Present Issue

The Issuer is issuing 30,000,000 Ordinary Shares of PKR 10 each for cash at a price of

PKR 10 per share - aggregating to PKR 300 million (the “Issue”).

The Issue is being made through the Book Building process at a floor price of PKR 10 per

share, whereby 66.7% of the total offer size i.e. 20,000,000 Ordinary Shares of PKR 10

each will be offered through the book building process to Institutional Investors and High

Net Worth Individuals (HNWI), while the balance 33.3% of the total Issue size i.e.

10,000,000 Ordinary Shares will be offered to the general public at the Strike Price.

2.2 BOOK BUILDING PROCEDURE

Book building is a process whereby investors bid for a specific number of shares at various

prices. The Joint Lead Managers & Joint Book Runners, with the consent of Issuer, sets a

floor price which is the lowest price an investor can bid at. An order book of bids from

investors is maintained by the Joint Book Runners, which is then used to determine the

strike price through the “Dutch Auction Method”.

Under the Dutch Auction Method, the strike price is determined by lowering the price to

the extent that the total number of shares that the Issuer intends to issue through the Book

Building process is subscribed. However, while determining the strike price the bids

placed through strike order shall not be taken into consideration.

A bid by a potential investor can be a “Limit Bid”, “Strike Bid” or a “Step Bid”, which are

explained below.

Limit Bid: Limit bid is at the limit price, which is the maximum price an investor

is willing to pay for a specified number of shares.

In such a case a bidder explicitly states a price at which he/she/it is willing to

subscribe to a specific number of shares. For instance, a bidder may bid for 2.0

million shares at PKR 15 per share. Since the bidder has placed a limit price of

PKR 15 per share, this indicates that he/she/it is willing to subscribe at or below

PKR 15 per share.

Strike Order: A bid for a specified number of shares at the strike price to be

determined through the Book Building Process.

In Strike Order the bidder explicitly states the number of shares he/she/it is willing

to subscribe at the Strike Price. For instance, a bidder may bid for 2.0 million

shares at the strike price to be determined through the Book Building Process.

Step Bid: A series of limit bids at increasing prices. The aggregate amount of step

bid shall not be less than PKR 1,000,000/- and the amount of any step shall not be

less than PKR 250,000/-.

Under this bidding strategy, bidders place a number of limit bids at different

increasing price levels. The bidders may, for instance, make a bid for 2.0 million

shares at PKR 13 per share, 1.5 million shares at PKR 14 per share and 1.0 million

shares at PKR 15 per share.


4

A SINGLE INVESTOR SHALL NOT MAKE MORE THAN ONE BID, HOWEVER,

A BID CAN BE REVISED.

THE INVESTORS SHALL NOT PLACE CONSOLIDATED BIDS. A BID

APPLICATION WHICH IS FULLY OR PARTIALLY BENEFICIALLY OWNED

BY PERSONS OTHER THAN THE ONE NAMED THEREIN IS TO BE

CONSIDERED AS CONSOLIDATED BIDS.

Once the bid period is over and book has been built, the Joint Book Runners shall

determine the strike price.

Successful bidders shall be intimated, within two (2) working days of the closing of the

bidding period, the strike price and the number of shares provisionally allotted to each of

them. The successful institutional bidders shall, within seven (7) working days of the

closing of the bidding period, deposit the balance amount as consideration against allotment

of shares. Where a successful bidder defaults in payment of shares allotted to

him/her/it, the margin money deposited by such bidder shall be forfeited to the Joint

Book Runners under clause 8.11 of Appendix 4 of the Listing Regulations of KSE.

AS PER REGULATION 8.16 OF KSE’S LISTING REGULATIONS, THE

SUCCESSFUL BIDDERS SHALL BE ISSUED SHARES IN THE FORM OF BOOK-

ENTRY SECURITIES TO BE CREDITED IN THEIR CDS ACCOUNTS. ALL THE

INSTITUTIONAL AND HNWI INVESTORS SHALL, THEREFORE, PROVIDE

THEIR CDC ACCOUNT NUMBERS IN THE BID APPLICATION.

2.3 JOINT LEAD MANAGERS AND ARRANGERS

National Bank of Pakistan (“NBP”), AKD Securities Limited (“AKDS”) and Arif Habib

Limited (“AHL”), have been mandated by the Issuer to act as Joint Lead Managers and

Arrangers to this Issue, which is being made through the Book Building process as laid out

in Appendix 4 of the Listing Regulations of the KSE.

2.4 JOINT BOOK RUNNERS

AKD Securities Limited (“AKDS”) and Arif Habib Limited (“AHL”) have been mandated

by the Issuer as the Joint Book Runners to the Issue.

2.5 ROLE AND FUNCTIONS OF JOINT LEAD MANAGERS AND JOINT BOOK

RUNNERS

a) The Joint Lead Managers to the Issue shall:

i. conduct awareness campaigns through presentations, meetings, road

shows etc. jointly with Joint Book Runners;

ii. ensure that all disclosures as required under the Companies Ordinance,

1984 and the Appendix 4 of the Listing Regulations of the Karachi Stock

Exchange have been made in the Prospectus;

iii. ensure that necessary infrastructure and electronic system/software is

available to collect bids and to carry out the Book Building process in a

fair, efficient and transparent manner;

iv. ensure that they have obtained on behalf of the Issuer, all

approvals/consents/NOCs relating to the Issue;


5

v. publish an advertisement, approved by the Commission, in at least one

Urdu and one English daily Newspaper having wide circulation in the

Federal and all the provincial capitals, to invite the Institutional investor

and HNWI to participate in the bidding process; and

vi. ensure that the preliminary Prospectus will, after approval of the

Commission, be uploaded on the Joint Book Runners as well as on the

Company‟s website.

b) The Joint Book Runners to the Issue shall:

i. conduct awareness campaigns through presentations, meetings, road shows

etc. jointly with LM;

ii. ensure that necessary infrastructure and electronic system/software is

available to collect bids and to carry out the Book Building process in a

fair, efficient and transparent manner;

iii. collect bid applications and applications‟ money, security, margin as the

case may be from the Institutional Investors and HNWI in the manner as

mentioned in the Appendix 4 of the Listing Regulations of the Karachi

Stock Exchange;

iv. put serial number, date and time on each bidding application at the time of

collection of the same from the bidders;

v. vet the bidding applications;

vi. build an order book showing demand for the shares at various prices;

vii. discover the strike price at the close of the bidding period;

viii. maintain record of the bids received for subscription of the shares;

ix. use the software for Book Building process provided by the Exchange,

which is based on Dutch Auction Methodology for display of the order

book and determination of the strike price, on the terms and conditions as

may be agreed in writing between the Exchange and the Joint Book

Runners;

x. for information of investors, ensure that in addition to live display of the

order book on the website of the Exchange, also live display the same order

book simultaneously on its own website till closing of the bidding period;

xi. ensure that each bid application contains depository account number of the

bidder maintained with CDCPL wherein shares shall be credited in case the

bid is successful;

xii. not accept multiple bids i.e. more than one bid applications by the same

person;

xiii. enter into underwriting agreement with the Issuer;

xiv. circulate copies of the preliminary Prospectus cleared by the Exchange and

approved by the Commission along with the bidding forms to the

prospective Institutional Investor and HNWI;


6

xv. BR have established bid collection centers at the following addresses:

Karachi

Contact Officer Mr. Ahmed Zeeshan

Direct No.: +92-21-32462597 Fax No.: +92-21-32429653 Email: [email protected] Postal Address: Arif Habib Limited

Arif Habib Centre

23, M.T. Khan Road, Karachi

Contact Officer: Mr. Syed Khurram Shahid

Direct No.: +92-21-3537-4301

Mobile No.: +92-333-310-4756

PABX No.: +92-21-111-253-111 Ext. 636

Fax No.: +92-21-3586-7992, +92-21-3537-3211

Email: [email protected]

Postal Address: AKD Securities Limited

6th Floor, Continental Trade Centre

Block 8, Clifton, Karachi

Lahore

Contact Officer: Mr. Ehsan Ahmad Qureshi

Direct No.: +92-42-3628-0742, +92-42-3628-0743,

+92-42-3628-0744

Mobile No.: +92-334-411-1253

PABX No.: +92-42-111-253-111

Fax No.: +92-42-3628-0745


Postal Address: AKD Trade

Room No. 512/513, 5th Floor

Lahore Stock Exchange Building, Lahore

Islamabad

Contact Officer: Mr. Khalid Hussain

Direct No.: +92-51-2894325

Mobile No.: +92-332-212-5525, +92-333-532-6580

PABX No.: +92-51-289-4321

Fax No.: +92-51-289-4323


Postal Address: AKD Trade 303, 3

rd Floor, ISE Tower

Jinnah Avenue, Blue Area, Islamabad

xvi. Ensure that all the bids received by the bid collection centers are entered into the

system developed by the Exchange for the purpose of Book Building. The Joint

Book Runners shall not accept and ENTER any bid after 5:00 p.m. during the

days of the bidding period, except the last day when no fresh bid(s) shall be

collected after 5:00 p.m. and the bid(s) collected thus far, shall be entered into

the system by 7:00 p.m. on the same day and thereafter no bid shall be entered

into the system or be revised in any way and for any reason even if the bid

applications have been received from the investor. Online revision will

however be allowed to the bidder between 5:00 pm – 7:00 pm on the last day.

mailto:[email protected]





7

2.6 OPENING AND CLOSING OF THE BIDDING PERIOD

The bidding period shall remain open for 2 working days commencing from the business

hours at 09:00 a.m. on MAY 02ND

, 2012 and will close at 05:00 p.m. on MAY 03RD

, 2012 at

the close of business hours

BIDDING PROCESS STARTS ON MAY 2ND

, 2012

BIDDING PROCESS ENDS ON MAY 3RD

, 2012

*(Both Days Inclusive)

2.7 ELIGIBILITY TO PARTICIPATE IN BIDDING

Eligible investors who can place their bids in the Book Building process are “Institutional

Investors” and “HNWI”.

Institutional Investors include both local and foreign institutional investors.

HNWI investors are individual investors who bid for shares of value of PKR

1,000,000/- (Pak Rupees One Million Only) or above in the Book Building

Process.

2.8 INFORMATION FOR BIDDERS

The Preliminary Prospectus for issue of shares has been duly cleared by the

Karachi Stock Exchange and approved by SECP.

The preliminary prospectus and the bidding form can be obtained from the

Registered Office of TPL Trakker Limited, AKDS, AHL and the bid collection

centers. Preliminary prospectus and bidding forms can also be downloaded from

the following website of the Joint Book Runners and the Company .i.e.

www.akdsecurities.net, www.arifhabibltd.com and www.tplworld.com.

Eligible investors who are interested in subscribing to the Ordinary Shares should

approach the Joint Book Runners at the addresses provided in clause (xv) of

paragraph 2.5 to register their Bids.

THE BIDS SHOULD BE SUBMITTED ON THE PRESCRIBED BIDDING

FORM IN PERSON OR THROUGH FAX NUMBERS GIVEN IN PARAGRAPH

2.5.

2.9 BIDDING FORM AND PROCEDURE FOR BIDDING

a) Standardized bidding form has been prescribed by the Joint Book Runners. Bids

shall be submitted at the bid collection centers in person or through fax number

given in paragraph 2.5 on the standard bidding form duly filled in and signed in

duplicate. The bidding form shall be serially numbered at the bid collection centers

and date and time stamped, at the time of collection of the same from the bidders.

b) Upon completion and submission of the bidding form, the bidders are deemed to

have authorized the Issuer to make necessary changes in the preliminary prospectus

as would be required for finalizing and filing the final prospectus with the KSE and

SECP, without prior or subsequent notice of such changes to the bidders.

c) The bidding procedure under the Book Building Process is outlined below:

http://www.akdsecurities.net/

http://www.arifhabibltd.com/

http://www.tplworld.com/


8

i. Copy of approved preliminary prospectus shall be circulated by the Issuer through

the Joint Book Runners to a maximum number of institutional investors and

HNWIs, but not less than ten in each category and a copy of the same will also be

placed on the websites of the Company and the Joint Book Runners.

ii. An advertisement, approved by the Commission, shall be published at least in one

Urdu and one English daily newspaper having wide circulation in the Federal and

all the provincial capitals, inviting the institutional investors and HNWI for

participation in the bidding.

iii. A Book Building Account shall be opened by the Issuer for collection of bid

amount.

iv. The bidding form shall be issued in duplicate signed by the bidder and

countersigned by the Joint Book Runners, with first copy for the Joint Book

Runners, and the second copy for the bidder.

v. Bids shall be submitted through the bid collection centers or through fax numbers

(+92-21-32429653, +92-21-35867992; 92-21-35869715, +92-42-36280745, +92-

51-2894323) on the standard bidding form duly filled in and signed in duplicate.

The addresses for the bid collection centers are given in paragraph 2.5.

vi. Bids can be placed at “limit price”, “strike order” or “step bid”.

vii. Bid money/margin money shall be deposited through demand draft, pay order or

cheque in favor of “Initial Public Offering of TPL Trakker Limited Book

Building Account”.

viii. Joint Book Runners shall collect an amount of 100% of the application money as

bid money in respect of bids placed by HNWIs.

ix. Joint Book Runners shall collect an amount of not less than 25% of the application

money as margin money in respect of bids placed by institutional investors.

x. Joint Book Runners may reject a bid placed by an Institutional Investor/HNWI for

reasons to be recorded in writing and the reasons should be disclosed to such

bidder forthwith. Decision of the Joint Book Runners shall not be challengeable by

the bidder or its associates.

xi. Joint Book Runners shall not accept the bids made at a bid price lower than

the Floor Price.

xii. The Issuer and Joint Book Runners shall not accept bids from associated

persons of the Issuer and the Company in excess of five percent (5%) of the

size of the book building portion.

xiii. The bidders will receive back the duplicate form upon submission of their bids

which will be proof of their bid submission. In case of facsimile, a copy of form

with receiving will be faxed back to the bidder.

xiv. Bidders can revise or withdraw their bids during the bidding period (for details

please refer to paragraphs 2.13 and 2.15).

xv. Joint Book Runners shall maintain record of the bids received

/rejected/revised/withdrawn along with identities of the bidder and evidence of

amount received.

xvi. Joint Book Runners shall ensure that all the bids received by the bid collection

centers are entered into the system developed by the Exchange for the purpose

of the book building according to the procedure given in paragraph 2.5 (b)

(xiii) and as per clause 8.6 of Appendix 4 of the Listing Regulations of KSE.

The system shall be capable to display live an order book, in descending order

with respect to the bid price, showing the demand for shares at various prices

and accumulative number of shares bid for along with percentage of the total


9

shares offered. The order book should also show the revised bids and the bids

withdrawn.

xvii. At the close of the bidding period, the Joint Book Runners shall determine the

strike price with the consent of the Issuer.

xviii. Successful bidders shall be intimated, within two (2) working days of the closing of

the bidding period, the strike price and the number of shares provisionally allotted

to each of them.

xix. The successful institutional bidders shall, within seven (7) working days of the

closing of the bidding period, deposit the balance amount as consideration against

allotment of shares.

xx. Under rule 8.11 of the Listing Regulation, where a successful institutional

bidder defaults in payment of shares allotted to it, the margin money

deposited by such institutional bidder shall be forfeited by Joint Book

Runners.

xxi. Margin money of unsuccessful bidders will be refunded within three (3) working

days of the close of the bidding period.

xxii. Final allotment of shares out of the Book Building portion shall be made after

receipt of full subscription money from the successful bidders; however, shares to

such bidders shall be issued at the time of issue of shares out of the general public

portion of the issue to successful applicants.

xxiii. An associated person or any other related person or party of the Issuer and the

Company shall not make bid(s) for shares in excess of 5%, in aggregate, of the

book building portion of the Issue.

2.10 BANK ACCOUNT FOR BOOK BUILDING AND PUBLIC PORTION

The Issuer has opened two separate bank accounts for collection of applications‟ money,

one each for the Book Building portion and the General Public portion of the Offer.

The bidders shall draw demand draft, pay order or cheque in favor of “Initial Public Offer

for TPL Trakker Limited – Book Building Account” which has been opened at Faysal

Bank Limited. The collection bank shall keep and maintain the bid money in the said

account. Once the strike price is determined and list of allottees is finalized, the Joint Lead

Managers, after obtaining NOC from KSE, may request in writing to the collection bank

for transfer of the money of successful and accepted applications to the Issuers‟ account(s)

and advise for refund of the bid money to unsuccessful bidders.

2.11 PAYMENT INTO THE BOOK BUILDING ACCOUNT

The bidders shall draw a demand draft, pay order or cheque favoring “Initial Public Offer

for TPL Trakker Limited – Book Building Account” and submit it at the designated bid

collection center either in person or through facsimile along with a duly filled in bidding

form.

CASH MUST NOT BE SUBMITTED WITH THE BIDDING FORM AT THE BID

COLLECTION CENTER. PAY ORDER, BANK DRAFT, CHEQUE OR ANY

OTHER APPROPRIATE INSTRUMENT ACCEPTABLE TO JOINT BOOK

RUNNERS AND DRAWN IN FAVOR OF “INITIAL PUBLIC OFFER FOR TPL

TRAKKER LIMITED – BOOK BUILDING ACCOUNT” ARE ACCEPTABLE.

Since the investors can bid for shares through “limit price”, “strike order” or “step bid”

therefore payment procedure is explained below for all the three (3) methods.


10

a) PAYMENT FOR LIMIT BIDS

If investors are placing their bids through “limit price” then they shall deposit the

margin money based on the number of shares they are bidding for at their stated bid

price.

For instance, if an investor is applying for 5 million shares at a price of PKR 17 per

share, then the total application money would amount to PKR 85 million. In such a

case, (i) HNWI shall deposit PKR 85 million in the Book Building account as the

bid amount which is 100% of PKR 85 million; and (ii) Institutional Investors shall

deposit at least PKR 21.25 million in the Book Building account as the margin

money which is at least 25% of PKR 85 million

b) PAYMENT FOR STRIKE ORDERS

If investors are placing a “strike order”, then they shall deposit the margin

money/bid amount equal to the product of the number of shares they are bidding

for and the Floor Price which in this case is PKR 10 per share.

For instance, if an investor is applying for 2.0 million shares then the total

application money would be PKR 20 million. In such a case, (i) HNWI shall

deposit PKR 20 million as bid amount which is 100% of PKR 20 million and (ii)

Institutional Investors shall deposit at least PKR 5 million as margin money which

is 25% of PKR 20 million.

In the event where limit and step orders are insufficient to determine price through

the Book Building mechanism, all strike orders will be considered for allocation of

shares at floor price. For details please refer to paragraph 2.16.

c) PAYMENT FOR STEP BIDS

If investors are placing a “step bid”, which is a series of limit bids at increasing

prices, then they shall deposit the margin money/bid money based on the total

number of shares they are bidding for at their stated bid prices.

For instance, if the investor bids for 0.5 million shares at PKR 13 per share, 0.4

million shares at PKR 14 per share and 0.3 million shares at PKR 15 per share,

then in essence the investor has placed one “step bid” comprising three limit bids at

increasing prices. The application money would amount to PKR. 16.60 million,

which is the sum of the products of the number of shares bid for and the bid price

of each limit bid. In such a case, (i) HNWI shall deposit PKR 16.60 million in the

Book Building Account as bid amount which is 100% of PKR 16.60 million and

(ii) Institutional Investors shall deposit at least PKR 4.15 million in the Book

Building Account as margin money which is 25% of PKR 16.60 million.

2.12 PAYMENT BY FOREIGN INVESTORS

Foreign investors may subscribe using their Special Convertible Rupee Accounts (SCRA),

as set out under Chapter 20 of the State Bank of Pakistan‟s Foreign Exchange Manual

2002.

Payments made by foreign investors shall be supported by proof of receipt of foreign

currency through normal banking channels. Such a proof shall be submitted along with the

Bidding Application by the foreign investors.


11

2.13 REVISION OF BIDS BY THE BIDDER

The bidders shall have the right to revise their bids any time during the bidding period upto

05:00 pm and on the last day till 07:00 pm. Online revision of the bids may be allowed to

the bidders through system software. This will however be subject to the condition that the

bidder shall comply with the requirements of bidding as disclosed under Appendix 4 of the

Listing Regulations and any other condition or procedure disclosed in the prospectus.

2.14 REJECTION OF BIDS BY THE JOINT BOOK RUNNERS

In terms of clause 8.4 of Appendix 4 of Listing Regulations of the KSE, Joint Book

Runners may reject a bid placed by an institutional investor/HNWI for reasons to be

recorded in writing and the reasons should be disclosed to such bidder forthwith. Decision

of Joint Book Runners shall not be challengeable by the bidder or its associates.

2.15 WITHDRAWAL OF BIDS BY THE BIDDER

A bidder has the right to withdraw placed bid from the bidding system any time during the

bidding period and on the last day till 05:00 pm. Online withdrawal of the bids may be

allowed to the bidders through system software. This will however be subject to the

condition that the bidder shall comply with the requirements of bidding as disclosed under

Appendix 4 of the Listing Regulations and any other condition or procedure disclosed in

the prospectus.

2.16 WITHDRAWAL OF ISSUE BY THE ISSUER

a) According to clause 3.10 of Appendix 4 of the listing regulations of KSE, in case

the Issuer does not receive bids at or above the floor price for the minimum number

of shares issued, it may withdraw the Issue. The decision of withdrawal shall be

taken within a period not more than three (3) working days of the closing of

bidding period.

b) The Issuer shall withdraw the issue if the total bids received are less than

fifteen.

c) The withdrawal shall be immediately intimated to the Commission and the

Exchange.

d) In case the issue is withdrawn the margin money/bid amount will be refunded

to the bidders within three (03) working days of the decision of withdrawal

without any markup, interest etc.

2.17 MECHANISM FOR DETERMINATION OF STRIKE PRICE

a) At the close of the bidding period, the Issuer, in consultation with the Joint Book

Runners shall determine the strike price on the basis of “Dutch Auction Method”.

Under this Methodology, the strike price is determined by lowering the price to the

extent that the total numbers of shares issued are subscribed. However, while

determining the strike price, the bids placed through strike order(s) shall not be

taken into consideration.

b) The order book shall display the bids in a tabular form in descending order along

with the number of shares bid for and the cumulative number of shares at each

price level. The bids at strike orders shall, however, be displayed in the order book

in the following manner:


12

BidderPrice

(PKR /Share)

Quantity

(Shares in Million)

Cumulative

Number of Shares

Category

of orderDay

Institution A 15.00 4.50 4.50 Limit Price Day 1

Institution E 14.50 1.50 6.00 Limit Price Day 3

Institution B 13.50 2.50 7.00 Limit Price Day 2

HNWI A 13.00 4.25 11.25 Step Bid Day 3

Institution C 11.25 3.00 14.25 Step Bid Day 1

HNWI B 11.00 5.75 20.00 Limit Price Day 2

Institution D X 1.00 21.00 Strike bid Day 2

HNWI C X 1.00 22.00 Strike bid Day 3


Institution B 10.25 4.00 29.00 Limit Price Day 2

HNWI A 10.10 2.75 27.75 Step Bid Day 3


Bid

WithdrawnStrike Price

determined through Dutch Auction Method

Bid has been revised

and placed at PKR 13.50/share

Total Shares

Subscribed

i. after the lowest limit bid, in case the limit bids placed are not sufficient for full

allotment of the shares issued, or,

ii. immediately, after the limit bid at which all the shares offered can be allotted, in

case the limit bids placed are sufficient for full allotment of the shares Issued.

c) For the purpose of allotment of shares, the limit bid(s) entered at the price

determined/discovered as Strike Price through Book Building Process and the bids

placed as strike order shall be ranked equally and preference will be given to the

bidder who has made the bid earlier.

Once the strike price is determined all those bidders whose bids have been found successful

shall become entitled for allotment of shares. The bidders, who have made bids at prices

above the strike price, will be issued shares at the strike price and the differential will be

refunded. The bidders, who have made bids below the strike price, shall not qualify for

allotment of shares and their margin money shall be refunded.

The mechanism for determination of strike price can be understood by the following

illustration.

a) Number of shares being Issued through the Book Building: 20.00 million

ordinary shares

b) Floor price: PKR 10 per share

c) Bidding Period: MM DD 2012 – MM DD 2012

Setting Strike Price – On the basis of the figures provided in the above illustration,

according to the Dutch Auction Method, the strike price would be set at PKR 11.00

per share to sell the required quantity of 20 million ordinary shares.

At PKR 15per share, investors are willing to buy 4.50 million shares. Since 15.50

million shares are still available, therefore, the price will set lower.

At PKR 13.50 per share, investors are willing to buy 2.50 million shares. Since

13.00 million shares are still available, therefore, the price will set lower.

At PKR 13.00 per share, investors are willing to buy 4.25 million shares. Since 8.75



13

At PKR 11.25 per share, investors are willing to buy 3.00 million shares. Since 5.75


At PKR 11.00 per share, investors are willing to buy 5.75 million shares. Since after

bidding for 5.75 million shares at PKR 11.00 per share no shares will be available,

therefore, the strike price will be set at PKR 11.00 per share for the entire lot of 20

million ordinary shares.

The bidders, who have placed bids at prices above the strike price, will be issued

shares at the strike price and the differential would be refunded. Investors, who

have bid below PKR 11.00/- per share, do not qualify for allotment and their money

would be refunded.

2.18 BASIS OF ALLOTMENT OF SHARES

After the closure of bidding period, the Joint Book Runners will analyze the demand

generated at various price levels. Only successful bidders shall be eligible for allotment and

issue of shares. Final allotment of shares out of the Book Building portion shall be made

after receipt of full subscription money from the successful bidders; however, shares to

such bidders shall be dispatched or credited, as the case may be, at the time of issue of

shares out of the public portion of the issue to successful applicants.

2.19 REFUND OF MARGIN MONEY

Investors who have bid lower than the strike price are not eligible for allotment of shares.

Margin money of the unsuccessful bidders shall be refunded within three (3) working days

of the close of the bidding period as required under clause 8.12 of Appendix 4 of the KSE

Listing Regulations.

2.20 UNDERWRITING

After determination of the strike price the Joint Book Runners shall within two (2) working

days of the closing of the bidding period enter into an underwriting agreement with the

Issuer indicating the number of shares that the Joint Book Runners would underwrite at the

strike price and the underwriting Commission/Fee to be charged.

2.21 PUBLICATION OF THE FINAL PROSPECTUS

The underwriting agreement for the public portion shall be finalized within ten (10)

working days from closing of the bidding period.

Upon finalization of the underwriting agreements, the Joint Lead Managers shall, within

ten (10) working days from the date of closing of the bidding period, submit an application

to KSE for allocation of dates for publication of the final prospectus and subscription of

shares by the general public.

The final prospectus in full or in abridged form must be published within seventeen (17)

working days of the closing of the bidding period in the manner as specified in Section 53

of the Companies Ordinance, 1984.

Public subscription for the shares shall be held at any date(s) within thirty days (30) of the

publication of the final prospectus but not earlier than seven (7) days of such publication.


14

2.22 ADDRESSES OF BID COLLECTION CENTRES

Bid Collection Centers have been established at Karachi, Lahore and Islamabad to collect

the bids for the Book Building portion of TPL Trakker Limited in order to provide

convenient access to bidders to participate in the bidding process. Addresses, detail of

contact persons and fax numbers of the Bid Collection Centers are given in paragraph 2.5.


15

2.23 STATEMENT BY THE ISSUER

7th March, 2012

The General Manager,

Karachi Stock Exchange (Guarantee) Limited,

Stock Exchange Building,

Stock Exchange Road,

Karachi.

On behalf of the Company, I confirm that all material information as required under the

Companies Ordinance, 1984 and the Listing Regulations of the Karachi Stock Exchange

(Guarantee) Limited has been disclosed in the Prospectus and that whatever stated in the

Prospectus and the supporting documents is true and correct to the best of our knowledge

and belief and that nothing has been concealed.

For and on behalf,

TPL Trakker Limited

-Sd-

____________________

Mohammad Ali Jameel

Chief Executive Officer


16

2.24 STATEMENT BY THE JOINT LEAD MANAGERS

Dated: 13th April 2012





Karachi.

Being mandated as Joint Lead Managers and Joint Arrangers to this Initial Public Offering

of TPL Trakker Limited through the Book Building process, we confirm that all material

information as required under the Companies Ordinance, 1984 and Appendix 4 of the

Listing Regulations of the Karachi Stock Exchange (Guarantee) Limited have been

disclosed in this Prospectus and that whatever stated herein and in the supporting

documents is true and correct to the best of our knowledge and belief and that nothing has

been concealed.

On behalf of:

-Sd- - Sd-

______________________ _____________________

Faisal Qamar Umair A. Shaikh

Vice President, SVP & Head, Investment Banking

Corporate & Investment Banking AKD Securities Limited

National Bank of Pakistan

-Sd-

______________________

Rafique Bhundi

Head, Investment Banking

Arif Habib Limited


17

2.25 STATEMENT BY THE JOINT BOOK RUNNERS

Dated: 13th April 2012





Karachi.

Being mandated as Joint Book Runners to this Initial Public Offer of TPL Trakker Limited

through the Book Building process, we confirm that all material information as required

under the Companies Ordinance, 1984 and Appendix 4 of the Listing Regulations of the

Karachi Stock Exchange (Guarantee) Limited have been disclosed in this Prospectus and

that whatever stated herein and in the supporting documents is true and correct to the best

of our knowledge and belief and that nothing has been concealed.

On behalf of:

-Sd- -Sd-

____ ___ ___________________

Umair Aijaz Shaikh Rafique Bhundi

Head, Investment Banking Head, Investment Banking

AKD Securities Limited Arif Habib Limited


18

PART 3

3. SHARE CAPITAL AND RELATED MATTERS

3.1 SHARE CAPITAL

No. of

Shares

Face Value

(PKR)

Premium

(PKR) Total (PKR)

AUTHORIZED CAPITAL

230,000,000 Ordinary Shares of PKR10/- each 2,300,000,000 - 2,300,000,000

ISSUED, SUBSCRIBED & PAID UP

CAPITAL OF THE COMPANY

9,900 Issued for Cash: Ordinary shares of PKR10/-

each

99,000 - 99,000

187,239,063 Issued for consideration other than Cash:

Ordinary shares of PKR10/- each*

1,872,390,630 - 1,872,390,630

187,248,963 Total 1,872,489,630 - 1,872,489,630

No. of

Shares

Face Value

(PKR)

Premium

(PKR) Total (PKR)

THE EXISTING SUBSCRIBED, ISSUED &

PAID UP CAPITAL OF THE COMPANY IS

HELD AS FOLLOWS

Shares held by Sponsors

131,074,273 TPL Holdings (Private) Limited 1,310,742,730 - 1,310,742,730

1 Mr. Mohammad Ali Jameel 10 10

131,074,274 Sub Total 1,310,742,740 - 1,310,742,740

Shares Held by other Shareholders

56,174,689 Digicore International (Pty) Limited

South Africa 561,746,890 - 561,746,890

56,174,689 Sub Total 561,746,890 - 561,746,890

187,248,963 Total 1,872,489,630 - 1,872,489,630

PRESENT OFFER*

No. of

Shares

Face Value

(PKR)

Premium

(PKR) Total (PKR)

The Present issue of 30,000,000

ordinary shares (13.81% of the post

IPO paid-up capital) having par value

of PKR10/- each is being made as

under:

20,000,000 Allocation to Institutions/HNWIs

investors through book building

process at a strike price of PKR10/-

each

200,000,000 - 200,000,000

10,000,000 General Public 100,000,000 - 100,000,000

30,000,000 Total Present Offer 300,000,000 - 300,000,000

217,248,963 GRAND TOTAL 2,172,489,630 - 2,172,489,630

* The total Capital issued against consideration other than cash amounted to PKR

1,872,390,630/- out of which the Capital allotted for consideration other than cash to the

sponsor company includes goodwill amount of PKR 1,319,736,192 in accordance with

Scheme of Arrangement executed on March 31, 2009 (the salient features of the scheme may

be seen at Para 5.1.1.of the prospectus ) among the Company, TPL Holding (Pvt.) Limited and

its members for transfer of entire business and undertaking of TPL Holding (Pvt.) Limited

[formerly Trakker (Pvt.) Limited] to the Company, except for the interest of TPL Holding

(Pvt.) Limited in Trakker Energy (Pvt) Limited. The Scheme was approved / sanctioned by the

Honorable High Court of Sindh vide its Order dated May 07, 2009.


19

For further detail, investor may refer to Para 2 of the Auditor Certificate dated 21 March 2012

given in Part 6 of the Prospectus.

Under Rule 8 of Issue of Capital Rules 1996, it is required that goodwill and other intangible assets

shall be excluded from consideration for Issuance of Shares otherwise than in cash. However, the

shares were issued pursuant to the decision of High Court dated May 07, 2009. For further details,

please refer paragraph 5.1.1.

Notes:

(i) As per Issue of Capital Rules. 1996 Rule No. 3(1) iv , the sponsors of the

Company shall at all times retain at least twenty five percent (25%) of the

capital of the company;

(ii) As per Regulation No. 67(7)(i) of KSE’s listing regulations, sponsor’s

shareholding in excess of 25% shall not be saleable for a period of six months

from the date of public subscription;

(iii) As per Regulation IIIA 6(6) KSE has relaxed the requirement of quantum of

public offering (Regulation IIIA 6(2)) which has also been approved by SECP

vide letter No. SMD/CO 57(1)/06/2009 dated April 23rd, 2012.

3.2 OPENING AND CLOSING OF THE SUBSCRIPTION LIST

The subscription list will open at the commencement of banking hours on 05-06-2012 and

will close on 06-06-2012 at the close of banking hours.

3.3 INVESTOR ELIGIBILITY FOR PUBLIC ISSUE

Eligible investors include:

a) Pakistani citizens resident in or outside Pakistan or persons holding two

nationalities including Pakistani Nationality;

b) Foreign nationals whether living in or outside Pakistan;

c) Companies, bodies corporate or other legal entities incorporated or established in or

outside Pakistan (to the extent permitted by their respective constitutive documents

and existing regulations, as the case may be);

d) Mutual funds, provident/pension/gratuity funds/trusts (subject to the terms of their

respective Trust Deeds and existing regulations); and

e) Branches in Pakistan of companies and bodies corporate incorporated outside

Pakistan.

3.4 FACILITIES AVAILABLE TO NON-RESIDENT PAKISTANI AND FOREIGN

INVESTORS

Non-resident Pakistani investors and foreign investors may subscribe for the shares being

issued through this Prospectus by using their Special Convertible Rupee Account

(“SCRA”) as set out in Chapter 20 of the Foreign Exchange Manual of the State Bank of

Pakistan.

3.5 MINIMUM AMOUNT OF APPLICATION AND BASIS FOR ALLOTMENT OF

SHARES

The basis and conditions of allotment to the general public shall be as follows:

(a) Application of shares below the total value of PKR 5,000 (Issue Price x 500


20

Shares) shall not be entertained.

(b) The minimum amount of application for subscription is of 500 ordinary shares is

PKR 5,000 (Issue Price x 500 Shares)

(c) Application for shares must be made for 500 shares or in multiples of 500 shares

only. Applications which are neither for 500 shares nor for multiples of 500 shares

shall be rejected.

(d) SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS

(MORE THAN ONE APPLICATIONS BY SAME PERSON) IS

PROHIBITED AND SUCH APPLICATIONS’ MONEY SHALL BE LIABLE

TO CONFISCATION UNDER SECTION 18-A OF THE SECURITIES AND

EXCHANGE ORDINANCE, 1969.

(e) If the shares issued to the general public are sufficient to accommodate all

applications, all applications shall be accommodated.

(f) If the share applied for are in excess of the shares issued, the distribution shall be

made by computer balloting, in the presence of the representative(s) of KSE in the

following manner:

i. If all applications for 500 shares can be accommodated, then all such

applications shall be accommodated first. If all applications for 500 shares

cannot be accommodated then balloting will be conducted among applications

for 500 shares only.

ii. If all applications for 500 shares have been accommodated and shares are still

available for allotment, then all applications for 1,000 shares shall be

accommodated. If all applications for 1,000 shares cannot be accommodated

then balloting will be conducted among applications for 1,000 shares only.

iii. If all applications for 500 shares and 1,000 shares have been accommodated

and shares are still available for allotment, then all applications for 1,500 shares

shall be accommodated. If all applications for 1,500 shares cannot be

accommodated then balloting will be conducted among applications for 1,500

shares only.

iv. If all applications for 500 shares, 1,000 shares and 1,500 shares have been

accommodated and shares are still available for allotment, then all

applications for 2,000 shares shall be accommodated. If all applications for

2,000 shares cannot be accommodated then balloting will be conducted

among applications for 2,000 shares only.

(g) After the allotment in the above mentioned manner, the balance shares, if any, shall

be allotted in the following manner:

i. If the remaining shares are sufficient to accommodate each application for

over 2,000 shares, then 2,000 shares shall be allotted to each applicant and the

remaining shares shall be allotted on pro-rata basis.

ii. If the remaining shares are not sufficient to accommodate all the remaining

applications for at least 2,000 shares, then balloting shall be conducted for

allocation of 2,000 shares to each of the successful applicants.

(h) If the issue is oversubscribed in terms of amount only then the allotment of shares


21

shall be made on the following basis:

i. First preference will be given to the applicants who applied for 500 shares;

ii. Next preference will be given to the applicants who applied for 1,000 shares;

iii. Next preference will be given to the applicants who applied for 1,500 shares;

and then;

iv. Next preference will be given to the applicants who applied for 2,000 shares;

(i) After allotment of the above, the balance shares, if any, shall be allotted on a pro-

rata basis to the applicants who applied for more than 2,000 shares.

(j) Allotment of shares will be subject to scrutiny of the applications for subscription

of shares.

(k) Applications, which do not meet with the above requirements or which are

incomplete will be rejected.

3.6 REFUND OF SUBSCRIPTION MONEY TO UNSUCCESSFUL APPLICANTS

The Company shall take a decision within ten (10) days of the closure of subscription list as

to which applications have been accepted or are successful and refund the money in cases

of unaccepted or unsuccessful applications within ten (10) days of the date of such

decision, as required under Section 71 of the Ordinance.

As per sub-section (2) of Section 71 of the Ordinance, if refund as required under sub-

section (1) of Section 71 of the Ordinance is not made within the time specified therein, the

Issuer shall be liable to repay the money with surcharge at the rate of 1.5% for every month

or part thereof from the expiration of the 15th day and, in addition, to a fine not exceeding

PKR 5,000/- and in case of continuing offense to a further fine not exceeding PKR 100/-

per day after the said 15th day on which the default continues. Provided that the Issuer shall

not be liable if he/she proves that the default in making the refund was not due to any

misconduct or negligence on his/her part.

3.7 ISSUE AND DISPATCH OF SHARE CERTIFICATES

The Company will dispatch share certificates to successful applicants through their Bankers

to the Issue or by crediting the respective Central Depository System ("CDS") accounts of

the successful applicants within thirty (30) days of the close of public subscription, as per

Listing Regulations of KSE.

Shares will be issued either in scrip-less form in the CDS of CDCPL or in the shape of

physical scripts on the basis of option exercised by the successful applicants. Shares in the

physical scripts shall be dispatched to the Bankers to the Issue within thirty (30) days from

the date of close of subscription list, whereas scrip less shares shall be directly credited

through book entries in the respective accounts maintained with the CDCPL.

The applicants who opt for receipt of shares in scrip-less form in CDS should fill in the

relevant columns of the Application Form. In order to exercise the scrip-less option, the

applicant(s) should have CDS account at the time of subscription.

If the Company makes a default in complying with the above requirements, it shall pay the

Stock Exchange a penalty of PKR 5,000/- per day for every day during which the default

continues. The Stock Exchange may also notify the fact of such default and the name of the

Company by notice and also by publication in the Daily Quotation of the Stock Exchange.


22

The name of the Company will also be notified to the members of the Stock Exchange and

placed on the web site of the Stock Exchange.

3.8 TRANSFER OF SHARES

(a) PHYSICAL SCRIPTS

Under the provisions of Section 77 of the Ordinance, the Directors of the Company

shall not refuse to transfer any fully paid share unless the transfer deed is, for any

reason, defective or invalid or is not accompanied by the relevant share certificate.

Provided that the Company shall within thirty (30) days from the date on which the

instrument of transfer was lodged with it, notify the defect or invalidity to the

transferee who shall, after the removal of such defect or invalidity, be entitled to re-

lodge the transfer deed with the Company.

(b) TRANSFER UNDER BOOK ENTRY SYSTEM

The shares maintained with the CDS in the book entry form shall be transferred in

accordance with the provisions of the Central Depositories Act, 1997 and the CDC

Regulations.

3.9 SHARES ISSUED IN PRECEDING YEARS

Sr.

No.

No. of

Shares

Issued

Par

Value

Amount

(PKR)

Consideration Date of Issue

1 100 10 1,000 Cash 4th Dec 2008

2 9,800 10 98,000 Cash 18th Dec 2008

3 131,064,374 10 1,310,643,740 Other than Cash 29th June 2009

4 56,174,689 10 561,746,890 Other than Cash 29th June 2009

Total 187,248,963 1,872,489,630

Shares issued for consideration other than cash have been issued pursuant to a scheme of

arrangement as sanctioned by High Court of Sindh by reference number J.M No. 21/2008

dated 07 May 2009. The Scheme of Arrangement has been discussed in detail in section

5.1.1 (For details please refer para 6.1, note no. 2 & 3). Other than the above mentioned

shares, there has been no other issue of shares since its incorporation.

3.10 PRINCIPAL PURPOSE OF THE ISSUE

The principal purpose of the public issue is the partial repayment of short term running

finance and to finance the working capital requirement of “Safe transportation

Environment” project (For detail of project please refer para 3.10.2(a) as well as expansion

of vehicle tracking and navigation operations. The IPO Proceeds will be utilized as follows:

a) repayment of short term running finance PKR 150 million ( the Company‟s short term

running finance under mark-up arrangements stood at around PkR387 million as at

December 31st, 2011) b) working capital of PKR 150 million for expansion of Container

Tracking, Vehicle Tracking and Navigation Solutions in Pakistan and Internationally.

Further the management has decided to list the shares of the Company at the Karachi Stock

Exchange to broaden its investor base and invite general public to participate in the profits

of the Company by providing them with an avenue of investment in the Company.

3.10.1 Repayment of Short Term Running Finance

The Company had obtained short term running finance from National Bank of Pakistan,

Standard Chartered Bank and Habib Metropolitan Bank Limited amounting to PKR 150


23

million, PKR 60 million and PKR 175 million respectively at a mark-up rate which range

from 15.25% to 16%. The repayment of loan will reduce the burden of interest cost on the

company thereby improving profitability.

3.10.2 Working Capital for Existing and Future Operations

a. Expansion of Container Tracking Operations:

As Pakistan is one of the major ports of the region, many shipments destined for

other nations come into and through Pakistan as “trans-shipments” or “in-transit

shipments.” FBR, since the last several years, has been working to monitor the

movement of cargo transit to Afghanistan. Recently, Government of Pakistan

signed the APTTA agreement which requires the installation of tracking device in

all containers that carry goods from one port to another to reduce pilferage and to

ensure smooth flow of goods. Based on this, FBR invited tenders in February 2011

for provision of tracking service.

TPL Trakker Ltd was among several other companies which participated in the bid

for the solution requested.

The bids were evaluated considering the financial and technical feasibility and after

several stages of evaluation; TPL Trakker was selected to undertake the project in

February 2012 and currently the licensing rules are being formulated.

The Project called “Safe transportation Environment” requires all cargo moving

from ports of Karachi to Afghanistan to have GPS satellite tracking systems

installed. Approximately around 8,500 containers a month use this trade route This

project requires tracking of over 100,000 containers each year. Under the license

with Pakistan customs, TPL Trakker will provide the monitoring of all containers

(reusable tracking units). The company will establish a Central Control Room

(“CCR”) at Pakistan Customs headquarters where they will monitor movement

themselves for exception based monitoring, escalation and reporting. The

containers will be fitted with sensor-equipped tracking units that transmit precise

location and condition information to the CCR for secure, real-time monitoring,

data management and communication unit access to enable customers to make

split-second decisions. Through this service TPL Trakker will provide an end-to-

end solution from product design to monitoring and reporting. TPL Trakker will

monitor each container leaving Karachi & Port Qasim Ports and monitor each truck

carrying the container. TPL Trakker will not only be using container tracking

through a modern satellite in addition to GPRS/SMS which provides real-time total

tracking anytime, anywhere, they will also be using Global Track reusable radio

frequency identification tags which will constantly be gathering data and

transmitting information through radio frequency. The Company will provide a 24-

hour on-line monitoring including:

Door open

Plunger switch to indicate unhinged container. Plunger switch is a

combination of mechanical and electrical functions and is designed for

rugged environments to sense the position of mechanical linkages and

controls.

Light inside container when doors have been opened (saddle or Covert

version)

Noise inside container if acoustic levels increase

Devise removal tamper if unit is removed


24

Tamper evidence seals (optional) indicates visually if hinge was removed

temperature change in cargo

The above mentioned project will not only benefit the company but also result in

significant benefits to the Country. Some of the benefits of the above mentioned

project to Pakistan as a whole have been highlighted below:

a) Compliance:

Comply with APTTA rules and regulations.

b) Enforce Trade Tariffs:

Monitoring these containers will significantly reduce or eliminate illegal

entry of unauthorized goods into Pakistan.

c) Contraband Prevention:

Reduce or eliminate the illegal entry of contraband such as arms, narcotics,

or other illegal cargo into Pakistan.

d) Eradicate pilferage enroute:

Through a combination of sensors and tracking/tracing the cargo enroute,

on a 24/7 basis, the company will provide a system that will minimize

pilferage.

e) Eliminate theft of transit cargo in Pakistan:

A series of door seals and other intrusion-prevention and detection means

will be provided, for installation on every container, to alert the security

personnel immediately upon intrusion.

g) Attain transport efficiencies:

The reporting capability will provide adequate information to manage any

routing, any necessary cargo re-routing, report on delays, and generally

provide all logistics information necessary to monitor and control

movement of cargo.

b. Vehicle Tracking Business Expansion :

TPL with its success in Pakistan and UAE now plans to further grow its operations

in Sri Lanka, the Middle East and Afghanistan. Sri Lanka has emerged as a new

destination for many IT investments and TPL Trakker plans to setup its operations

to cater to the vehicle tracking requirements for the growing tourism industry. New

security initiatives by the Sri Lankan Government have further raised more

opportunities for vehicle tracking business.

In the Middle East, TPL Trakker plans to setup its operations to access customers

in the region. Operations expansion in following countries planned Qatar, Jordan,

Egypt and Oman.

c. Location and Navigation Business Coverage Expansion:

As the demand for navigation service is increasing TPL requires working capital to

further enhance its map coverage to over 1000 cities/ Towns in Pakistan. With this

TPL will maintain its legacy as the leader in providing the most advanced and

comprehensive navigation solution for Pakistani consumers.


25

Current Data Expansion Plan

POI (Points of Interest) 600,000

2 Million

Road Network Coverage 98,000 Kilometer

500,000 Km‟s

House Addresses 400,000

1 Million

3D Models 3000

5000

2D Models 46,822 250,000

Cartography Data 4599 10,000

3.11 INTEREST OF SHAREHOLDERS

None of the holders of the issued shares of the Company have any special or other interest

in the property or profits of the Company other than as holders of the ordinary shares in the

capital of the Company.

3.12 (a) DIVIDEND POLICY

The rights in respect of capital and dividends attached to each share are and will be the

same. The Company in its general meeting may declare dividend but no dividend shall

exceed the amount recommended by the Directors. Dividend, if declared in the general

meeting, shall be paid according to the terms of the provisions of the Ordinance.

The Directors may from time to time pay to the members such interim dividends as appear

to the Directors to be justified by the profits of the Company. No dividend shall be paid

otherwise than out of the profits of the Company for the year or any other undistributed

profits.

No unpaid dividend shall bear interest or mark-up against the Company. The dividends

shall be paid within the period laid down in the Ordinance.

(b) ELIGIBILITY FOR DIVIDEND

The shares issued by the Company shall rank pari-passu with the existing shares in all

matters, including the right to such bonus or right issues, and dividend as may be declared

by the Company subsequent to the date of issue of such shares.


26

3.13 DEDUCTION OF ZAKAT

Dividend distribution will be subject to deduction of Zakat at source, pursuant to the

provisions of Zakat and Ushr Ordinance, 1980. (XVIII of 1980) as may be applicable from

time to time.

3.14 CAPITAL GAINS TAX

Capital gains derived from the sale of listed securities are taxable in the following manner

under section 37A of Finance Act 2011;

Holding Period of Securities

S.No Tax Year Less than 6

months

More than 6 months

but less than 12 months

More than 1 year

1. 2011 10.0% 7.5% 0%

2. 2012 10.0% 8.0% 0%

3. 2013 12.5% 8.5% 0%

4. 2014 15.0% 9.0% 0%

5. 2015 17.5% 9.5% 0%

3.15 WITHHOLDING TAX ON DIVIDEND

Dividend distribution to shareholders will be subject to withholding tax under section 150

of the Income Tax Ordinance, 2001 at the rate of 10% specified in Part 1 Division III of the

First Schedule of the said Ordinance or any time to time amendments therein. In terms of

the provision of Section 8 of the said Ordinance, said deduction at source, shall be deemed

to be full and final liability in respect of such profits.

3.16 DEFERRED TAXATION

Deferred tax is accounted for using the liability method in respect of all temporary

differences at the balance sheet date between the tax base of assets and liabilities and their

carrying amount. Deferred tax liabilities are recognized for all taxable temporary

differences. Deferred tax assets are recognized for all deductible temporary differences to

the extent that it is probable that the temporary difference will reverse in the future and the

taxable profits will be available against which the temporary differences can be utilized.

The carrying amount of deferred tax asset is reviewed at each balance sheet date and

reduced to the extent that it is no longer probable that sufficient taxable profit will be

available to allow deferred tax asset to be utilized.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to

the period when the asset is realized or the liability is settled, based on the tax rates that

have been enacted or subsequently enacted at the balance sheet date.

The company has booked deferred tax asset of PKR 5.325 million as at 31st December

2011.

3.17 SINDH SALES TAX & WITHHOLDING TAX ON SALE/PURCHASE OF SHARES

(a) Under the constitution of Pakistan and Articles 49 of the 7th NFC Award the

Government of Sindh has promulgated the Sindh Sales Tax on Service Act, 2011

(Sindh Act No. XII of 2011) (the Act) which has taken effect from July 2011. The

Sindh Revenue Board Constituted under the Act (Sindh Act No. XI of 2010)

administers and regulates the levy and collection of the Sindh Sales Tax (SST) on

the taxable services provided or rendered in Sindh.


27

The value of taxable services for the purpose of levy of sales tax is the gross

commission charged from clients in respect of purchase or sale of shares in a Stock

Exchange under section 41(1) of the Sindh Sales Tax Rules, 2011, dated 30th June

2011 The Second Schedule of the Act levies a sales tax on Brokerage at the rate of

16%. The sales tax is withheld as per the requirements of Sindh Sales Tax Special

Procedure (Withholding) Rules, 2011.

(b) Withholding Tax of 0.01% will be charged on purchase/sale value on the

purchase/sale of shares/Modaraba certificates / instruments of redeemable

capital.

3.18 TAX CREDIT FOR INVESTMENT IN IPO

Under Section 62 of the Income tax Ordinance, 2001, a resident person other than a

company shall be entitled to a tax credit for a tax year in respect of the cost of acquiring in

the year new shares offered to the public by a public company listed on a stock exchange in

Pakistan, provided the resident person is the original allottee of the shares or the shares are

acquired from the Privatization Commission of Pakistan.

Time Limit for holding shares has been designated as 36 months to avail tax credit. The

amount of investment, eligible for tax credit, is prescribed in section 62 of the said

Ordinance.

3.19 TAX CREDIT FOR ENLISTMENT

Under Section 65C of the Income tax Ordinance, 2001, tax credit at 15% of the tax payable

shall be allowed for the tax year in which a Company is listed on a Stock Exchange in

Pakistan.


28

PART 4

4. UNDERWRITING, COMMISSIONS, BROKERAGE AND OTHER EXPENSES

4.1 UNDERWRITING


AKD Securities Limited and Arif Habib Limited have been mandated as the Joint Book

Runners to the issue. The Joint Book Runners will underwrite the Book Building

portion of the issue which comprise of 20.0 million Ordinary Shares within two (2)

working days of the closing of the bidding period as required under clause 5 of

Appendix 4 of the listing regulations of the Karachi Stock Exchange at the strike price

determined through the book building process.

In the opinion of the Directors, the resources of the Underwriter are sufficient to

discharge its underwriting commitments/obligations.

PUBLIC PORTION

As required under clause 6 of Appendix 4 of the listing regulations of the Karachi

Stock Exchange, the public portion of the issue 10.0 million ordinary shares will be

underwritten as follows:

Name of Underwriter Number of Shares

Underwritten Amount (PKR)

National Bank of Pakistan 500,000 5,000,000

AKD Securities Limited 5,000,000 50,000,000

Invest Capital Markets Limited 3,500,000 35,000,000

PAIR Investment Company Limited 1,000,000 10,000,000

TOTAL 10,000,000 100,000,000

4.2 UNDERWRITING COMMISSION


The Joint Book Runners will be paid book running and underwriting commission at the

rate of 1.5% of the Book Building portion of the issue i.e. 1.5 % of PKR 20.0 million.

In addition to the underwriting commission, the Joint Book Runners will be paid a take-up

commission at the rate of 2% of the amount taken up.

GENERAL PUBLIC PORTION

The underwriters have been an underwriting commission at the rate of 1.5% of the

amount underwritten by them. In addition, a take-up commission at the rate of 2% shall

be paid to the underwriters on the value of the shares to be taken-up by virtue of their

respective underwriting commitments/obligations.

4.3 BUY BACK/REPURCHASE AGREEMENT

THE UNDERWRITERS HAVE NOT ENTERED INTO ANY BUY BACK/RE-

PURCHASE AGREEMENT WITH THE COMPANY OR ANY OTHER PERSON IN

RESPECT OF THIS PUBLIC ISSUE.

ALSO, NEITHER THE COMPANY NOR ANY OF ITS ASSOCIATES HAVE

ENTERED INTO ANY BUY BACK/RE-PURCHASE AGREEMENT WITH THE


29

UNDERWRITERS OR THEIR ASSOCIATES. THE COMPANY AND ITS

ASSOCIATES SHALL NOT BUY BACK/RE-PURCHASE SHARES FROM THE

UNDERWRITERS AND THEIR ASSOCIATES.

4.4 COMMISSION TO THE BANKERS TO THE ISSUE

Commission at the rate of 0.50% of the amount collected on allotment in respect of

successful applicants will be paid by the company to the Bankers to the Issue for services to

be rendered by them in connection with the public issue, plus out-of-pocket expenses, if

any.

4.5 BROKERAGE

For this Issue, brokerage shall be paid to the members of KSE, LSE and ISE at the rate of

1.0% of the value of shares (including premium if any) actually sold through them. No

brokerage shall be payable in respect of shares taken up by the Underwriters by virtue of

their underwriting commitments.

4.6 ESTIMATED EXPENSES OF THE ISSUE

Expenses to the issue are estimated not to exceed PKR 29.5 million. The break-up of these

preliminary expenses is given below:

Expenses to the Public Issue Rate Amount

(PKR)

Underwriting Commission - Book Building 1.00% 2,000,000

Underwriting Commission - General Public 1.50% 1,500,000

Take up commission - Book Building* 2.00% 4,000,000

Take up commission - General Public* 2.00% 2,000,000

Commission to Bankers to the issue including the out of pocket

expense

0.50% 550,000

Brokerage to the members of Stock Exchanges 1.00% 3,000,000

Book Runners Fee 0.50% 1,000,000

Lead Management and Arrangement Fee 3.00% 9,000,000

Printing, publication of prospectus/application forms 2,000,000

KSE listing fee and charges:

- Initial Listing Fee* 2,172,490

- Annual Listing Fee 379,312

KSE software charges

250,000

CDC annual fees for Eligible Security 67,500

CDC Fresh Issue Fees 300,000

SECP application and processing Fees 200,000

Legal & Professional Charges 500,000

Balloters and Share registrars fees etc 150,000

Miscellaneous costs 500,000

Total 29,569,302

* These amounts represent the maximum possible costs under these heads.


30

PART 5

5. THE ISSUER

5.1 COMPANY HISTORY

TPL Trakker Limited (“TPL Trakker” or the “Company”) was incorporated as a private

company under the Companies Ordinance, 1984 on December 4, 2008. Pursuant to a

scheme of arrangement approved and sanctioned by the Honorable High Court of Sindh,

TPL Trakker Limited acquired the businesses and assets of TPL Holdings (Pvt) Limited.

The Company was subsequently converted into a public company on September 16, 2009.

5.1.1. BRIEF ON SCHEME OF ARRANGEMENT:

During the period ended 30 June 2009, a Scheme of Arrangement was executed on 31

March 2009 among the Company, TPL Holding (Private) Limited (TPL Holdings) and the

shareholders of TPL Holdings for transfer of entire business and undertakings of TPL

Holdings to the Company, except for the interest in Trakker Energy (Private) Limited

(here-in-after referred to as “Excluded Asset” ). The shareholders of TPL Holdings in their

extra ordinary general meeting held on 06 March 2009 approved a Scheme of Arrangement

(the Scheme) under section 284 to 287 of the Companies Ordinance, 1984. The Scheme

was approved/ sanctioned by the Honorable High Court of Sindh vide its order reference

number J.M No. 21/2008 dated 07 May 2009 as approved by the Honorable High Court of

Sindh. Accordingly:

a) the entire undertaking of TPL Holdings including all the properties, assets,

receivables, liabilities and all the rights and obligations except for the

Excluded Asset have been transferred into and vested in the Company as

on the effective date;

b) in consideration for the restructuring under the Scheme, the Company

issued and allotted 131,074,274 ordinary shares of PKR 10/- each, as fully

paid-up, to registered ordinary shareholders of TPL Holdings equivalent to

seventy per cent (70%) of the issued and paid up capital of the Company as

on the effective date; and

c) Digicore transferred its shareholdings in TPL Holdings to AB Group and

AJ Group in their existing shareholding ratio in the paid up share capital of

TPL Holdings. Simultaneously, the Company issued 56,174,689 shares

equivalent to thirty per cent (30%) of the issued and paid up share capital

of the Company to Digicore

d) The Total Purchase Consideration under the scheme was PKR1,872.49

million and the total fair value of assets transferred to the Company was

PKR1,890.80 million and the fair value of liabilities transferred to the

Company was PKR1,338.05 million. The difference was recognized as

goodwill on acquisition.


31

Note: TPL Trakker Limited as appearing in the new strcuture in the above chart, was

incorporared in December 2008 and at that time the shareholding of TPL Trakker Limited

was held by Ali Jameel Group (99%) and Trakker Holdings (Pvt) Limited (1%).

5.2 COMPANY HISTORY

TPL Trakker Ltd is Pakistan‟s number one Satellite Vehicle Tracking Company in terms of

market share, corporate profile and branding. TPL Trakker is the pioneer of vehicle

tracking Services in Pakistan.

TPL Holdings (Pvt) Limited launched the vehicle security and fleet management concept in

Pakistan in the year 2000 as a joint venture with the South African multinational DigiCore

Holdings Limited which has 30% shareholding in the Company. The businesses and assets

of TPL Holdings were transferred pursuant to the scheme of arrangement to TPL Trakker

Limited on March 31, 2009.

With its head office in Karachi and branch offices in Lahore, Islamabad / Rawalpindi,

Faisalabad & Multan, Sialkot, Gujranwala & Peshawar, TPL Trakker Ltd is providing car

tracking services in over 320 cities all over Pakistan. The Company currently has a staff

strength of over 520 personnel.

TPL Trakker has exclusive rights to use DigiCore‟s signature C-track technology which

merges GPS technology with GSM service providers‟ SMS & GPRS data service to bring

information directly from the vehicle to the TPL Trakker control room. C-track has been

developed specifically to assist with the management of commercial fleets, sales vehicles,

car rental, security transportation and individual car owner applications. It has the ability to

provide vehicle position within 4 meters accuracy. Components of C-track technology are

provided by world renowned technology companies such as Mitsubishi, Trimble, U-Blox,

Wavecom, and Schlumberger and therefore ensure reliable performance. DigiCore‟s C-

track is used by over 550,000 customers internationally and it enjoys market leader status in

South Africa, Africa, Pakistan, United Kingdom, Europe, Australia and Brazil. According

to ABI Research (telematics USA) C-track was ranked 2nd globally based on

implementation, relative costs, installed base, regional deployment, and range of solutions.


32

TPL Trakker utilizes this information to deliver to clients a comprehensive analysis of their

vehicle in order to aid their efforts to increase efficiency and productivity as well as prevent

fraud.

The Company has a 24 hour call centre which has two sections that work around the clock,

and answer calls within 10 seconds. On average, these call centers receive up-to 2,000

calls, and make 4,500 calls, and monitor an average 2,000 alarms on daily basis. The

alarms when required are dealt with by the Trakker Response Team (managed by TPL

Security Services) which ensures the recovery and return of stolen cars from an area

including the most remote regions of the country. TPL Trakker‟s high level of performance

is essentially due to its own dedicated licensed security Company exclusively for vehicle

recovery.

TPL Trakker Achievements At Glance – 13 Years of Excellence

TPL Trakker has established a solid platform based on which it continues to expand its

product portfolio and build on its customer base. TPL Trakker‟s initial target market was

the retail segment, where it has now established itself as the dominant player. Based on this

success, TPL Trakker is now expanding into higher margin institutional clients.

Additionally along with its core asset tracking services, TPL Trakker has launched related

products and services which supplement its core asset tracking service offering and

provides its customers with a complete portfolio of services to choose from.

5.2.1 JOINT VENTURE PARTNER DIGICORE HOLDINGS:

The Company‟s Joint venture partner DigiCore Holdings specializes in the research,

design, development, manufacture, sales and support of technologically advanced

GPS/GSM fleet management and vehicle tracking solutions. Digicore has operations in

over 30 countries globally with 350 employees providing support to over 550,000

customers.


33

Brief Financial Overview of DigiCore for the last three years:

Source Digicore Holdings Website

Source Digicore Holdings Website

DigiCore works in partnership with its customers to develop solutions that deliver

measurable business and operational benefits by providing total Tracking and control of

mobile assets and mobile work forces.

A wide range of vehicle location, fleet management, satellite navigation, workflow, mobile

job planning and security tools are utilized to provide commercial vehicle, van and car fleet

operators with scalable solutions that offer flexibility, reliability and functionality.

DigiCore has significant global operations and these are detailed below:

5.2.2 DIGICORE GLOBAL OPERATIONS

Europe and United Kingdom

Digicore presence in Europe and UK has further shown signs of growth and in the

past 2-3 years they have recorded reasonable sales activity during the year 2010 -

11. Five regional branches were opened during the year plus new contracts were

signed.

Asia and Middle East

DigiCore established regional headquarters in late 2010 in Kuala Lumpur. This

region is viewed as one of the markets with the biggest growth potential for C


34

track. Digicore is well positioned in the region, with key distributors, joint venture

partners and a strong management team in place. UAE and Pakistan are the leaders

in this region and have shown consistent growth over the past many years despite

economic challenges.

Australia and New Zealand

In August 2010 DigiCore acquired a 25% stake in Vehicle Management Systems

(VMS) which, in turn, took over the Minorplanet Asia Pacific business. DigiCore is

finalizing the purchase of a further equity stake to increase its holding in VMS to

69%.

Australia-listed mining giant BHP Billiton renewed its contract for a further three

years.

Latin and Central America

The C track Latin America regional headquarters was established in August 2010

in Mexico City. Key customers such as BHP Billiton (Colombia), Nestlé (Chilé)

and Cusaem (Mexico), SABMiller (Peru) and Falabella (Colombia) provide a solid

customer base from which to grow. A joint venture with Spanish group Tecnocom

has been established in selected markets.

5.3 BUSINESS OVERVIEW AND PRODUCTS

TPL Trakker‟s business portfolio can be divided into three broad categories i.e. Asset

Tracking Solutions, Container Tracking Solution and Location and Navigation Solution.

5.3.1 ASSET TRACKING SOLUTIONS:

These are business lines that utilize asset tracking and location technology to

provide security, safety and fleet management solutions. Our customer base

includes financial institutions group (FIG‟s), multinational companies (MNC‟s)

and individuals. From tracking assets like vehicles, trucks, generators to people, the

asset tracking solution is continuously expanding.

5.3.1.1 Global Asset Tracking Industry

Asset tracking services have been around since the 1970‟s under the name of

Global Positions Systems (GPS) developed by the United States Department of

Defense, but it was only in the next decade that the U.S government decided to

make the system positioning data freely available to other industries around the

world. These industries use this information to enhance their products and services.

GPS fleet management industry is expected to show healthy growth in 2012 as the

market dynamics and trends shift to scalable end-to-end solutions, driver

management applications, and regional strategic ecosystems. FMS revenues are

expected to reach $9.5 billion in 2015, according to forecasts just released by ABI

Research dated 8th April 2010

5.3.1.2 Asset Tracking Services in Pakistan

Just as the global asset tracking service market is growing, the market in Pakistan is

also growing exponentially. TPL Trakker is the only company in Pakistan which

has been offering quality asset tracking and fleet management systems. Since its

inception the asset tracking service market has grown gradually as the demand for


35

these systems has shown tremendous growth mainly due to its usage by logistic

companies, fleet operators and retail and corporate customers. Total companies

providing vehicle tracking service in Pakistan are almost 50.

This industry is driven by a number of components which includes:

i) Rising disposable incomes;

ii) higher cellular penetration;

iii) greater mobility;

iv) the general level of law and order in the country;

v) an increasing number of large businesses using extensive transportation

fleets; and

vi) growth in the automobile sector.

The growing market of automobile is also increasing the sales of tracking products

as more and more insurance companies are persuading customers to install tracking

devices. In addition they are insuring the vehicles, which reduce their claim ratio to

a significant extent. The following chart depicts the growth of cars sales over the

last three years.

Source PAMA (Pakistan Automotive Manufactures Association)

Further, fleet customers have increased their demands from simple tracking of the

vehicles to intelligent monitoring and reporting of their assets at regular intervals.

The reporting required for each fleet vehicle requires detailed analysis which our

fleet management information system provides.

5.3.1.3 Asset Tracking Solutions offered by TPL Trakker

The following is a description of the services offered by the TPL Trakker Asset

Tracking Solutions:

Vehicle Tracking Security - The vehicle tracking services of TPL Trakker employ

a state of the art command and control center, and Digicore‟s C-track technology,

through which TPL Trakker is able to monitor the movements and location of

vehicles. Since our inception in 2000, we have recovered over 7000 vehicles and

cargo worth Rs.11 billion.


36

The Company offers different products under its Vehicle Tracking and Security

services as detailed below:

C-track Secure – Stolen Vehicle Recovery

C-track Secure is designed primarily for those customers who want to secure their

vehicles without requiring any online navigation, location, or historical data

support. This uses the same GPS/GSM as its other products.

As an add-on to this product, Anti Jamming device was introduced in 2010 with the

aim to counter the effects of jamming device being used by criminals to

temporarily disable the system and to subsequently frisk the vehicle to remove the

unit.

C-track Secure Plus – Stolen Vehicle Recovery – With Added Features

C-track Secure Plus is a value added extension of the functions of C-track Secure

with the following additional features:

Watch Mode – By sending an SMS to the vehicle‟s unit, the customer can activate

“Watch Mode” which enables the unit to send an SMS to the customer, if the

ignition of the vehicle is switched on.

Remote Polling /Location Status – Users can send an SMS to their car‟s unit to

obtain the real time location of the vehicle. It allows the customers to further

communicate directly with their car‟s unit, and allowing customers to use their

mobile phones as security monitors for their cars.

C-track Assist– For Vehicle Tracking and Security

This product utilizes GPS technology, to provide vehicle positioning within 4

meters average accuracy and GSM networks to transmit information real time, 24

hours a day all year round. C-track Assist is a product suited for both individual car

owners, as well as commercial fleet and car rental vehicle security applications.

This enables customers to keep track of their vehicles at all times. Additionally all

of TPL Trakker‟s C-track Assist customers can avail its Web Track service to

connect to the TPL Trakker‟s website and view their vehicles exact location.

As part of the vehicle tracking and security services, TPL Trakker also provides

services to deal with crimes such as kidnapping and associated white collar crimes

such as fraud. TPL is responsible for having prevented several cases of kidnappings

and extortion and assisting customers in crime related emergencies. Its Emergency

Response Teams respond to live status data monitoring which includes vehicle

movement, restricted area alarms, tampering with batteries and emergency

response alerts – services other tracking companies do not provide.

Initially TPL Trakker‟s Asset Tracking Service products were taken up by retail

customers primarily for vehicle security and tracking. The product saw tremendous

success and TPL Trakker‟s products acquired a generic quality. Subsequently the

Company‟s product was utilized by leading commercial banks such as Dubai

Islamic Bank, United Bank Limited, NIB Bank etc for monitoring their auto


37

finance customers to create a risk profile as well as enhance security and prevent

fraud (portfolio management).

C-track Solo – For Fleet Management Services

TPL Trakker engages in comprehensive fleet data reporting and analysis to provide

improved fleet utilization, productivity and security using its C-track Solo–

Comprehensive Vehicle Tracking and Security product. Designed as a solution for

the region‟s Fleet Management requirements and recognized as an essential part of

every modern transportation fleet C-track Solo is being adopted by leading

multinationals and local companies including Shell, Chevron and British

Petroleum. C-track Solo is a full featured scalable, remotely upgradeable product

for haulers, logistics & supply chain management, mobile workforce management

& emergency services application. C-track Solo is based on a hardware platform

which utilizes the GPS technology to provide vehicle positioning within 4 meters

average accuracy and the Mobilink GSM network to transmit real time information,

24 hours a day, all year round.

Using C-track Solo, TPL Trakker uses the key indicators for fleet performance

such as mileage, fuel consumption, employee productivity, trip route analysis, and

driver performance analysis in order to improve fleet efficiency. These services

allow customers to benefit from decreased vehicle maintenance and repair costs,

and provide an accident analysis, driver performance and an improved bottom line.

Power Generators Monitoring

Another innovation of TPL Trakker Limited is the introduction of C track Solo for

remote monitoring of power generators. The monitoring unit is installed in the

generator and the software delivers location and status reports, engine run hour

reports, alert notifications, maintenance reminders, service logs, history logs and

various other services.

The product will assist in monitoring fuel consumption of power generators,

improve effectiveness, efficiency and reduce cost by eliminating extra time and

labor involved to collect the meter reading.

Trakker has addressed the issue of utilization; fuel level monitoring and pilferage

with this product. By monitoring the fuel lid, secured by a sensor, the time of

opening is compared with the arrival of the refueling vehicle, and discrepancies are

notified. Moreover, fuel levels are pre-marked in the system, which are also sensed

and monitored.

This product is ideal for banks & financial institutions, generator rental companies,

telecommunication, oil & gas and corporate sector operating large and scattered

inventory of generators across the country and can now be easily monitored

through C-track Solo.

5.3.2 CONTAINER TRACKING SOLUTIONS

This segment of TPL business covers cargo tracking requirements of commercial

and military transporters. Our scope includes tracking and protecting transit,


38

transshipment or any high value cargo against intrusion or pilferage. The product

used for container tracking utilizes both GSM and Satellite technology to provide

Estimated Time of Arrival (ETA) and location even in the remotest part of the

world. To date, the Company has provided tracking service to over 24,000

consignments.

5.3.2.1 Global Industry Overview:

Shipping container tracking is a subset of asset tracking and aims at securing assets

and increase operational efficiency. After 9/11, the tracking and monitoring of

shipping containers came in focus and now with the advancement in technology,

more than 80% of the international trade goods are carried by sea. The number of

tracking systems with GPRS or satellite communication for intermodal containers

in active use is forecasted to grow at a compound annual growth rate of 66.9

percent from 77,000 units at the end of 2011 to 1.0 million by 2016. The

penetration rate of remote tracking systems in the total population of intermodal

containers is estimated to increase from 0.4 percent in 2011 to 3.6 percent in 2016.

The container tracking solution incorporates data logging, satellite positioning and

data communication to back office application. At a high level, the infrastructure

for container tracking can be divided into four segments:

i. Container segment – All containers connected to the tracking solution need

to have a combined satellite positioning and wireless communication unit. The

unit can be of a range of form factors and may be connected to various sensors

and peripherals inside and outside of the container.

ii. GNSS segment – The real-time container tracking solution relies on public

global navigation satellite systems such as GPS, GLONASS, or in the near

future Galileo for accurate positioning of containers.

iii. Network segment – Wireless wide area networks are employed by the

container tracking solution for data transmission. GPRS mobile networks and

satellite communication are currently the most widely used systems.

iv. Back office segment – Behind a data communication gateway, a wide range

of standard and third party applications may have access to data from the

containers.

Through the tracking of containers, the inventory of goods is managed in real time

environment, cost of insurance premium is reduced, criminal, theft and other similar

incidents during transportation are transmitted to back office.

5.3.2.2 Container Tracking Solution in Pakistan

Pakistan Container Market Overview:

The Container port traffic (TEU: 20 foot equivalent units) in Pakistan was

2,058,056 in 2009, according to a World Bank report, published in 2010. Port

container traffic measures the flow of containers from land to sea transport modes.,

and vice versa, in twenty-foot equivalent units (TEUs), a standard-size container.

Data refer to coastal shipping as well as international journeys. Transshipment

traffic is counted as two lifts at the intermediate port (once to off-load and again as

an outbound lift) and includes empty units.


39

The Container port traffic is expected to boost with the FBR taking keen interest in

monitoring the movement of containers from the port. TPL Trakker Limited has

been awarded the contract for providing the container monitoring service by FBR

and approximately 100,000 containers will be monitored annually through this

project, which will boost the container port traffic simultaneously.

5.3.2.3 Container Tracking Solution offered by TPL Trakker

Shippers/transporters want the ability to give their customers accurate information

on the whereabouts of their containers, in a seamless and efficient way.

Additionally, governments also want to ensure that duty-free and bonded cargo

destined to local dry ports or neighboring countries is safely and securely delivered

and that no „leakage‟ occurs during transit.

Importers also want the ability to ensure that goods they are importing into the

country arrive securely, complete and intact, with the ability to know WHEN they

will arrive and be ready for pick up.

TPL Trakker believes that container tracking is an exciting area for growth and has

thus entered into an agreement with GlobalTrak, a leader in the deployment of

container tracking and asset tracking solutions. Through this partnership, TPL

Trakker enhances its asset management and security solutions by incorporating

GlobalTrak world leading line of products and software to its existing product

portfolio. In 2010, TPL Trakker in partnership with GlobalTrak launched its in-

transit Tracking solutions for all container movements in Pakistan and Afghanistan.

Through this agreement TPL Trakker will provide 24x7 support, installation and

monitoring of container movement destined to Afghanistan. To date, TPL

Trakker has provided Tracking for over 24,000 consignments.

In 2011, TPL Trakker expanded its Container Tracking Solutions coverage to

Middle East providing companies associated with Marine industry the most

advanced solutions to meet the tracking requirements of the region.

5.3.3 LOCATION AND NAVIGATION SOLUTIONS

This segment of TPL business uses GPS technology for navigation products and

services. Products include portable navigation devices, in-dash infotainment

systems, Maps and advance location based services.

5.3.3.1 Global Industry Overview:

i. Overall Navigation Market:

Shipments of navigation devices worldwide have shown an increase from

2007 to 2012, with a compound annual growth rate (CAGR) of 22.5%,

according to a new forecast released by ABI Research1. Europe commands a

53% share of the global market since 2007, and has remained the primary

navigation devices market. However the Asian market shows the most rapid

growth with a CAGR of 27%.

1 http://www.berginsight.com/ShowReport.aspx?m_m=3&id=133


40

ii. Personal Navigation Devices Market:

Recent research by In-Stat found the following: Worldwide unit

shipments of PNDs are expected to grow from 30.7 million units in 2007

to 68 million units in 2012.

PND manufacturers are integrating advanced functionality in PNDs in

order to improve the price/performance value.

iii. Mobile Navigation Market:

According to a new research report from the analyst firm Berg Insight, the

number of mobile subscribers using a turn-by-turn navigation service or

application on their handset grew 57 percent from H1-2009 to H1-2010 and

reached 44 million worldwide. The subscriber base is forecasted to grow at a

compound annual growth rate (CAGR) of 33.1 percent to reach 195 million

users worldwide in 2015.

5.3.3.2 Navigation Services Offered by TPL Trakker

TPL Trakker has recently introduced TrakkerNAV navigation software. The

product was first launched in 2009 for providing mobile navigation services.

Trakker has a well-experienced and qualified GIS team and field surveyors who

collect data and process it according to a well-defined specification. Due to the

dynamic nature of content, the team keeps the data updated with high frequency of

data collection. The constant feedback from our vehicle-tracking customers also

contributes to the data update process. TPL Trakker mapping team will be

constantly updating every map in every city making sure that the customer has the

most up to date map of the city. The data quality is in compliance to ISO 19100

(19113, 19114, 19115) quality standards with established set of quality plan.

Map Coverage:

With rigorous efforts of over so many years, the map coverage includes major

highways of Pakistan and road/street network of 120+ cities of Pakistan with over

150 more cities to be added shortly. Points of Interest data is currently over

600,000 and by end of the year 2012 will increase to 2 Million. Currently we have

3000 3D landmarks and will increase this to over 5000 by the end of this year.

TrakkerNAV offers an all-inclusive navigation experience and is a pioneer of

navigation in Pakistan.

TrakkerNAV extends its functionality outside the vehicle and allows pre-planning

of trips and sharing of information on the web and can also be used without GPS.

TrakkerNAV can be installed on a wide range of mobile phones (IPhone, Nokia,

Sony Ericsson, Motorola, Blackberry, HTC, HP) and PDA‟s. With high-end GPS

mobile navigation, 3D navigation view and clear voice instructions makes

TrakkerNAV a perfect navigation product. Trakker Nav and Sygic have partnered

to provide the application for online stores and for the past 2-3 months the

application has been on the top 10 ranking for Pakistan. TrakkerNAV also offers

corporate clients an opportunity to have their business location placed on the


41

navigation map. For example one of the applications of TrakkerNAV is the ATM

finder, which directs the user to the closest ATM in the area.

TPL Trakker in February entered into an agreement with Toyota Pakistan to

become the supplier of OEM in dash navigation software. Under this agreement

TPL will provide Toyota training, KIOSKS, 24x7 hotline plus dedicated help desks

in each showroom. Toyota has given TPL a committed volume Purchase Order for

6,000 navigation installation to be done at Toyota Plant.

Navigation Solutions by TPL

In Dash ( In car Navigation)

PND ( Personal Navigation Device)

Mobile (Smart Phone Navigation Application)

a. In Dash Navigation:

TPL Trakker entered in IDN market 6 years ago and since has pioneered in

bringing in the latest technology in this segment. Some of the key features are:

Complete Navigation System and in-car entertainment system.

Advanced Search System

Optimal Route Calculation (Based on different algorithms)

Points of Interest search

Turn by Turn voice guidance

Covers 120 cities and all major highways in Pakistan.

Constant Data updates and inclusion on new POIs

b. Personal Navigation Device:

Personal Navigation Device segment is growing fast and for individuals or small

car owners who cannot afford the complete infotainment solution have opted for a

more economical PND. PND includes the same features and is mobile and can be

used in all vehicles.

c. Mobile Navigation:

TPL started its mobile navigation with Mobitrack in 2009 and since have managed

to lead this segment in Pakistan. The application is currently available on 2

platforms Android and IOS. Some of the features of the mobile applications are:

Live updates using mobile internet

Weather

Detailed 3D maps

Social Media sharing

Elevation model


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Apple Application Store:

The application is sold under the name of “Sygic & Trakker Nav “and is one of

most famous applications for Pakistan users of IPhone and IPad. This application

has been on the top 5 charts of app store for many months now. Some key

highlights on app store have been.

Top Paid application

Top Grossing

Top Most Reviews

Top Navigation Application in Pakistan

Top Most downloads by a paid application in Pakistan within a month.

Brief Financial Overview

TPL Trakker brief financial overview since its inception is illustrated in the

diagrams below:

Source: Annual Audited Accounts

*The Company incurred after tax loss of Rs. 9 million in 2009 due to deferred tax amounting to Rs. 16

million.

Source: Annual Audited Accounts


43

Financial results from 2000 to March 2009 pertains to Trakker (Pvt.) Ltd, which in

pursuance to the Scheme of Arrangement described earlier, was converted into TPL

Trakker Limited and the Profit and Loss of 2009 is being considered on an

aggregate basis.

5.4 GROUP STRUCTURE (SUBSIDIARIES AND ASSOCIATE COMPANIES):

TPL Trakker Limited has the following subsidiaries and associates:

TPL Trakker owns

- 67.39% of TPL Direct Insurance Limited.

- 29% of Trakker Middle East LLC.

- 41% of TPL Properties (Pvt.) Limited.

- 99.99% of TPL Security Services (Pvt.) Limited.

5.4.1 TPL DIRECT INSURANCE LIMITED

TPL Direct Insurance Ltd (TDI) was launched in 2005, when TPL Trakker Ltd

(sponsor of TDI) acquired Jupiter Insurance Company Limited. TDI is the first

direct insurance company in Pakistan that differs with conventional companies by

offering 24 hour claims and underwriting services through a team of highly skilled

Call Centre officials, pioneering the concept of web based services to allow

customers to interact and retrieve progress of their insurance policies and claims.

Underwriting services includes providing premium quotations and explaining the

various products of motor and travel to the inbound call customers. TDI offers fair

and equitable premium rates that are determined on the basis of risk profiling done

by the leading firm of actuaries. The Company has the fastest claim settlement and

processing time and possesses a strong in-house risk inspection and survey

capability and therefore maintains the lowest claims processing and settlement time

in the entire industry – 60 seconds claims lodging, 45 minutes claim processing and

7 days claims settlement. It has strong rapport with the 3S dealers (authorized by


44

the manufactures as dealers for sales, services and spare parts) and workshops that

ensures quality and timely repairs.

TDI started its operations with a focused approach towards increasing its business,

initially focusing on niches where it has an advantage. The car insurance sector

provides excellent synergies with its parent entity, providing a clear advantage to

the Company in this sector. This strategy coupled with the growth prospects of the

car insurance sector allowed the Company to accumulate critical mass. The

Company employs an actuarial based risk profiling mechanism for developing

customized rates for every customer. This not only helps the Company in arriving

at a judicious quote but also allows it to have a much better understanding of the

quality of risk being acquired. The use of tracking device as mandatory for most of

the current products allows the Company to have one of the lowest vehicle theft-

related claims in the industry.

The insurance industry is predominantly agency based. The agents are the main

source of business. TDI took a bold step by launching a direct company. This is

cost effective as well as allows the company to have a direct rapport with the

customer.

The Company recently got listed on the Karachi Stock Exchange (KSE) on 22

September 2011.

Direct insurance concept with value additions

The direct insurance concept offers the customers to interact directly with the

company for buying the insurance policy or lodging of claims. This eliminates the

need for the insurance broker or agent that is a common trait in the insurance

market. Further the direct operation also facilitates the customer to get insurance

quotes then and there, whether by calling at the Call Centre or the underwriters

directly.

5.4.1.1. Value Added Services for TDI Customers

TDI promotes Innovation and strives for service excellence. TDI has engineered

certain value added services that are not offered by any other insurance company in

Pakistan. The unprecedented services include, where applicable:

I. Free Usage of C Track Facility

As a part of risk management and also to render safety of the customers, TDI

installs C Track Unit in the insured vehicles that are under 3 years old. The

service is free of any charge or annual monitoring fees. TDI has chosen its

parent company i.e. TPL Trakker Ltd to be the service and product provider as

they are the best and largest tracking company in Pakistan.

II. 24 Hour Call Centre

TDI is the first insurance company to have launched a 24 hour Call Centre

manned by highly trained insurance officials. This is outsourced to TRG who

were the pioneers in introducing the Call Centre industry in Pakistan. The Call

Centre is fully equipped to handle sales, conduct outbound calls, fastest and

easiest claims recording, and arrangement for emergency services in Karachi

for free tow services.


45

III. Instant Survey Capability

TDI has its own team of highly skilled in-house surveyors that renders instant

inspections and surveys, whilst other insurance companies heavily rely on third

party surveyors. TDI therefore registers fastest claims processing and

settlement capability.

IV. Authorized Workshops

All authorized workshop commonly known as 3S (dealers for sales, service and

spare parts) by the leading vehicle manufacturers are TDI‟s business partners.

This gives TDI‟s customers a priority treatment in the vehicle repairs and the

company ensures proper repairs with replacement of genuine parts, if any.

V. Free EVAC Membership (for Karachi)

TDI has recently introduced value added service by providing Road Side

Assistance through its wholly owned subsidiary EVAC Pakistan (Pvt) Ltd.

This service includes roadside assistance in the event of an Accident,

Mechanical Breakdown, Flat Tyre or Vehicle Running out of Petrol. EVAC

offers mobile workshop and tow service.

5.4.1.2. Strengths & achievements

First direct insurance company of Pakistan with over 15,000 customers.

First company to launch insurance cover with free usage of C-track.

First company to have 24 hour service manned by highly qualified Call Centre

outsourced to TRG.

First company to launch the Web Based policy

First company to launch policy that covers Theft and Third Party Liability

commonly known as 3T policy.

Fastest claim processing time in the industry i.e. 60 seconds claims lodging, 45

minutes processing and settlements within 7 days.

Only company in Pakistan using Risk Profiling specially developed by Actuaries

Sidat Hyder for premium rating.

New motor products introduced in the market

Big financial institutions have reposed trust in TDI and have joint label

agreements for providing cover to the customers of Dubai Islamic Bank,

Standard Chartered Bank and United Bank Ltd.

TDI is consecutively being conferred with the Brands of the Year Award for

best vehicle insurance company since 2007 by The Exhibitor with support from

FPCCI, PSQCA (Ministry of Science & Technology) and other bodies.

One of the lowest claims ratio at around 40%

Credit period remarkably at lowest < 10 days

A- rating by PACRA

Overseas Reinsurance with A rated companies.

Most comprehensive MIS and Actuarial analysis done for premium pricing.


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5.4.1.3. Products

TDI is a progressive insurer with reputation for creating better ways to understand

customers‟ needs. Many new products were introduced in the Auto insurance these

are detailed below:

TDI Auto Direct offers wide range of auto insurance solution especially tailored for

safety of vehicle and family. TDI Home Direct Insurance is designed to give

comfort and peace of mind. Home Direct plan provides wide range of insurance

packages covering fire to the personal property, with household items, furniture,

fixture and other valuables. TDI Travel Direct provides most affordable

comprehensive travel insurance packages that will make the trip hassle-free. With

just one phone call, TDI provides a complete range of products directly at doorstep.

TDI also offers multiple Bancassurance Direct options.

a) Auto Direct

TDI‟s Auto Direct offers wide range of auto insurance products as set-forth below:

i) Comprehensive Insurance:

This product covers vehicle on a comprehensive basis, covering damage, theft and

third party. This product offers free usage of C-Track Secure with no additional

charge of Annual Monitoring fee, and offers free use of EVAC services. ii) Comprehensive Insurance for used vehicles:

This product is specially tailored for 3 years or above old vehicles (excluding 4X4

& imported vehicles) with comprehensive cover at low rates. This product carries

special offer of Depreciation waiver on the first claim on parts applicable on the

first claim.

iii) Self Insurance:

This is comprehensive policy under which the customer assumes the claim if any

upto PkR.10,000 and avails discount upto 25% of the gross premium. Safe drivers

and those who use their vehicles sparingly can take advantage of Self Insurance.

iv) Executive Cover for vehicles having tracking device already installed:

This is comprehensive policy designed exclusively for existing Trakker customers

with “C-track” already installed in their vehicles. Such customers can get

refund/adjustment / discount of Annual Monitoring.

v) 3T Insurance:

The most affordable way to get auto insured at the lowest premium rates. The triple

covers include Theft cover, Third Party Insurance and Free usage of C-Track

Secure services.

vi) TDI – Senior Citizens:

TDI values senior citizens between (age group of 60 to 75 years) and offer special

discount of 20%. Option of any of the auto product can be taken, where applicable.


47

vii) TDI – Lady Drivers (Comprehensive Policy for Working Women) Lady

Drivers:

This product is designed especially for working women in recognition of their

invaluable contribution to our economy and society. TDI offers 15% discount on

the auto products, where applicable.

b) TDI's Home Direct

It caters for protection of home from the peril of fire and burglary. Home Direct

Plan provides wide range of packages for every person. Cover offered from

Rs.0.5m to Rs.20m.

c) Cash and Jewellery Insurance

TDI offers three packages namely Silver, Gold and Platinum that provides

burglary, fire, atmospheric damage and snatch of cash and jewellery in the house as

well as outside the premises. The cover ranges from Rs.350,000 to 1,000,000 with

limits set forth for snatch cover outside the premises.

d) Bancassurance Direct

i. Secure Wallet Plan:

Secure Wallet Plan is a valuable insurance protection scheme. It is specifically

designed for customers holding Credit Cards to cater for unforeseen eventualities

such as:

Loss or theft of credit card(s) Loss or theft of keys and identification papers Death or disability (due to theft/robbery) ATM Cash Withdrawal Cover (due to theft/robbery)

ii. ATM Cash Withdrawal:

The insurance plan covers financial losses, damages and claims arising due to

snatching and robbery of cash withdrawn from any ATM, within the vicinity

iii. Credit Personal Accident Plan:

Provides insurance coverage for credit card holders, in case of permanent total

disability or accidental death of the Insured Person.

iv. Family Protection Plan:

This is a value added personal accident product which provides accidental death,

temporary and permanent total disability and limited medical coverage to bank‟s

account holders.

v. Purchase Protection Plan

When a Card member charges a covered purchase with his or her card account, the

Purchase Protection Plan protects that item for 60 days from the date of purchase if

it is stolen or accidentally damaged including vandalism.


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Source: Annual Audited Accounts for last five years ended December 2007-11.

5.4.1.1 EVAC PAKISTAN (PRIVATE) LIMITED

The company was incorporated on 5th December 2007 as a private limited company under

the Companies Ordinance, 1984. EVAC is the first company to render round the clock road

side assistance service in Karachi. This includes towing of the vehicle through its high tech

tow trucks. It also renders unique service of providing on the spot road assistance to the

vehicle in case of accident, mechanical or electrical breakdown, flat tyre, loss of keys,

drained battery etc. through a fully equipped Mobile Workshop. During the year 2009, TPL

Direct Insurance Limited acquired 100% shareholding of the Company. Authorized capital

of the company is Rs. 20 million with paid-up capital of Rs. 17.3m.

EVAC service is currently offered in Karachi only. Its operations are centered out of a

control room which is manned by trained call center official. EVAC has responder vehicles

and team on standby 24/7. The team comprises of well qualified technicians who not only

diagnose the problem but do their best to resolve it right there.

5.4.2 TPL SECURITY SERVICES (PVT.) LIMITED

TPL Trakker provides security and repossession services through its Company TPL

Security Services as an extension of its vehicle security and tracking services. TPL Security

Services benefits from significant synergies with TPL Trakker. TPL Security Services was

established in 2000. TPL Security Services maintains 38 Recovery Teams for immediate

nationwide deployment in response to customer needs. These teams provide comprehensive

coverage of Karachi, Hyderabad, Multan, Lahore, Faisalabad, Islamabad, Peshawar and all

motorways & highways. TPL Security Services teams are well armed and equipped with

state-of-the-art communication technology and IT tools, guided from TCR to exact

locations for repossession and recovery of vehicles.

TPL Security Services has witnessed a considerable growth in its business, as insurance

companies and financial institutions with auto finance divisions are increasingly seeking to

validate claims of theft and/or snatching. TPL Security Services‟ speedy recoveries and

analysis of missing vehicle claims lodged by clients have made it a popular resource for

many corporations attempting to deal with the growing menace of white collar crime. TPL

Security Services works hand in hand with repossession teams from financial institution to

identify the current location of the client‟s vehicle and subsequently its repossession.


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5.4.3 TRAKKER MIDDLE EAST LLC

Industry Overview:

Middle East still promises to be an increasing market for the fleet management and vehicle

tracking industry. Not only does the booming regional economy host many large

corporations owning vehicle fleets, it is also the place of origin for several oil and gas

companies which rely on light and heavy commercial vehicles to transport fuel. Such

entities require efficient and safe handling of their mobile assets. Additionally the Middle

East‟s many car rental companies are fitting their cars with GPS/GPRS satellite tracking

units to prevent car theft. These car rental companies are increasingly relying on fleet

management and tracking devices as cost effective and efficient methods in the monitoring

and recovery of vehicles.

Trakker Middle East:

After its success in Pakistan, in 2005 TPL Trakker launched its vehicle tracking, vehicle

recovery, fleet management and portfolio management services in UAE as Trakker Middle

East (“TME”). TME was established in partnership with two prominent Middle Eastern

groups; UAE Offsets Group/Mubadala and Al Jaber Group. TME is the sole distributor for

DigiCore International (South Africa) in the Middle East (excluding Saudi Arabia) and has

been given the responsibility to establish the required infrastructure to sell and support C-

track products in United Arab Emirates. Further strength is achieved from Trakker Middle

East, offering state-of-the-art mobile asset tracking and fleet management services to

customers since 2005 and today proudly managing over 18,000 in UAE and growing. Since

2005, more than 20 players have entered the market, but only a few have become active

due to TME‟s strong market position. Although TME‟s products are more expensive than

competitors it has been successful primarily due to the fact that TME has kept its

commitment in providing top quality industry standards in the following areas:

24x7x365 call center

Round the clock installation options

Customized reports

Good brand equity with corporate customers

Approximately 30 car hire companies in the UAE have already installed C-track in their

vehicles (100 units on average per client). Sharjah-based Solo Rent-a-Car, for example, has

employed their C-track systems in the recovery of three of their stolen vehicles. The

increased incidents of thieves posing as clients in the Middle East is one of the driving

factors leading to a greater number of car rental companies using tracking devices. There

have been many reported occurrences of rented cars that are stolen and then subsequently

shipped to places such as Russia, North Africa and Eastern Europe, and tracking devices

such as C-track provide effective solutions to such security concerns.

Private clients in the United Arab Emirates are also resorting to C-track tracking systems to

protect their luxury cars and trucks. Sharjah Municipality and Al Wathba have been

supplied with C-track units for over 3000 vehicles. As a result insurance companies are also

beginning to offer special rates to individuals or companies that have C-track devices

installed, as tracking devices have the potential to reduce car theft and vandalism claims

from customers.


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Being the sole distributor of C-track in the Middle East (excluding Saudi Arabia), TME is

looking to expand to a number of countries in the GCC and is planning to enter the Saudi

market in 2013. Through the success that TME has had in the UAE, Abu Dhabi Company

for Onshore Oil Operations, Aman Municipality and Abu Khatar Group of Jordan are

negotiating orders for approximately 2,000-3,000 units from TME over the next two years.

Going forward TME plans to aggressively target 4 main areas to gain market share:

Dealer network - TME will launch a comprehensive dealer strategy which will involve

training sessions for dealers, commission based sales, dedicated sales staff at

dealerships, constant feedback and monthly refresher training to be conducted for the

first 6 months

Insurance Network - TME will target the larger players in the auto insurance, and

work with them to reduce the chance of theft and fraud. Additionally, Insured clients‟

list to be targeted for outbound marketing by TME Sales Team. Target will be vehicles

worth above AED 100,000

Financial Institutions - With tough financial conditions, Auto loans are now taking

longer for approval and disbursement. Right time to offer C-track as an asset tracker as

well as innovative source of recovery of monthly rentals. Banks can lower their lending

rate as with C-track, their asset is less exposed to delinquency / fraud.

Free Trial Offer - Free trial offers to corporate over a 2 month period. TME expects to

generate substantial positive feedback and increased awareness.

Additionally TME will launch a complete marketing campaign including; traffic updates on

radio, front page banner ads, C-track articles in print media, advertisements in malls, mail

shots, internet marketing and SMS marketing to increase sales and awareness.


Source: Annual Audited Accounts for last five years ended December 2007-11

5.4.4 TPL PROPERTIES (PVT) LIMITED

TPL Properties is the real estate arm of TPL Holdings. Currently, TPL Properties is

constructing a project at KPT Interchange on Shaheed-e-Millat Expressway, Karachi,

namely Centre Point.


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Centrepoint is designed by the region‟s leading team of professionals as a 385 ft high,

landmark in Karachi‟s architecture. The 28 storeys project is being constructed on 26,226

sq.ft. (2,914 sq.yds.) of land and it will offer 196,618 sq.ft. of rentable space (total project

area: 352,662 sq.ft.) The building offers state of the art facilities, including built in IT

infrastructure, international standards of security and fire safety, 9 floors of dedicated

parking, and in-house independent power generation. Additionally, Centrepoint will feature

a health club, swimming pool, coffee bar, cafeteria and luxurious reception spaces making

it an ideal rental choice for high end corporations.

For the construction of the project, a $20 million loan was received from the Overseas

Private Investment Corporation (OPIC). With this loan, TPL Properties expects to complete

construction of the Centrepoint office building in central Karachi in 2012, and will then

begin leasing space to large local and multinational organizations.

The Company has completed 92% of the structural work of Centrepoint, its first real estate

project. The project is designed exclusively as a modern office complex with the latest in-

house infrastructure facilities ideal for large local and multinational corporations.

TPL Properties has formed a wholly owned subsidiary under the proposed name of

Centrepoint Management Services (Pvt.) Limited (“CMS”), which will be the owner of

power generating facilities and will be responsible for building maintenance, whereas, TPL

Properties will own the land and building structure and other equipment. TPL Properties

and CMS will enter into separate agreements with tenants for rental and provision of

building maintenance services/electricity respectively.

TPL Properties has engaged the leading local and international team of consultants to

ensure timely completion of the project which has been graded “PG3+” jointly by PACRA

(formerly Fitch IBCA) and NESPAK. This is the highest grading given by them to a real

estate project in Pakistan and implies good project execution capability and good prospects

of timely completion and transfer of ownership as per terms.

TPL Properties is following a build, rent out and operate model and intends to exit through

REIT or listing of the development company within 4 - 5 years.

Brief Financial Overview:

Source: Annual Audited Accounts for year ended June 2010-11 and interim review of six months ended

December 2011.


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5.5 GROUP FINANCIAL OVERVIEW

The chart below depicts the audited consolidated group revenue; profit before and after tax

and EBITDA for the year ended 30 June2011 and group equity and assets as at 30 June

2011.

Source: Annual Consolidated Audited Accounts for the year ended 30 June 2011

5.6 FUTURE PROSPECTS

5.6.1 ASSET TRACKING SOLUTIONS

New advance Fleet Management Solution for Oil & Gas sector:

TPL after the success of the world renowned fleet management solution has now launched

IVMS (In vehicle Monitoring System) for oil and gas industry. This new product complies

with HSSE standards and is one of the most advance systems for monitoring driver

behavior and ensuring safety while delivering highly flammable products.

Personnel Tracking:

TPL Trakker is bringing in the smallest personnel tracking system in Pakistan for tracking

field force for efficiency and safety. This product is currently being tested in TPL Labs and

promises to bring the most advanced tracking technology in a small enclosure. This product

will be launched in July 2012.

5.6.2 CONTAINER TRACKING SOLUTION

Container Tracking Solution Business Expansion:

After the success in Pakistan TPL will be opening up new markets to cater to the increasing

demand for tracking cargo in middle east and Afghanistan . Offices will be setup in

Afghanistan to assist both commercial and military projects. Furthermore CIS region

expansion has become vital to support Afghan Transit Trade from northern routes.

TPL with its tracking solution for custom agencies has already been approached by Dubai

Customs and Afghanistan Custom Agency. Both have shown interest in solutions offered


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by TPL to monitor duty evasion, pilferage of transit cargo and ensure compliance by

transporters and importers.

5.6.3 LOCATION AND NAVIGATION SOLUTIONS

After the success of Trakker Nav, TPL plans to expand its product portfolio and coverage

to reach out to the masses and bringing in innovative products and coverage expansion to

the remotest places of the country.

4th

Generation connected Navigation:

With the world moving towards connected technology inside the car TPL is the first one to

be there and currently testing the most advanced computer technology to provide drivers

with the real time internet, email, weather, traffic and maps even on the move. TPL plans to

launch its connected navigation technology by September 2012.

Launch with Urdu and local languages:

For the first time in Pakistan TPL will be launching its navigation with Urdu and other

famous local languages. After detailed research and development TPL believes it will bring

in the features of a localized version which will be able to cater to all types of drivers. The

Urdu version will be available in June 2012.

Coverage Expansion:

Pakistan‟s land area is 803,940 Sq Km and TPL Plans on Mapping 80% of land mass by

end of year 2013. The largest database of POI‟s of over 2 Million by end of this year will

make TPL the strongest player in the country.

5.6.4 INTERNATIONAL OPERATIONS

TPL Trakker plans to expand its operations in Qatar, Jordan, Egypt, Oman, Afghanistan

and Sri Lanka.

5.7 RISK FACTORS

The Company wishes to highlight the following major risk factors, which may affect the

profitability of the Company:

5.7.1 BUSINESS RISK

The Company‟s performance outlook, market activity and the larger economic picture

influence the price of its stock. When the economy is expanding, the outlook for many

companies will be good and the value of their stocks should rise. The opposite is also true.

Usually, the greater the potential reward, the greater would be the risk. For small

companies, startups, resource companies and companies in emerging sectors, the risks and

potential rewards are usually greater. Performance of the Company may also be affected

due to unexpected shortfalls in the information technology infrastructure and inadequate

risk management by the back office.

MITIGANT

The Company is expected to mitigate the impact of business risk by employing adequate

risk management measures to ensure that exposures remain within prudent limits. In

addition, disaster recovery plans should help mitigate the impact of risk arising from failure


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of information technology infrastructure. Corporate governance measures shall also be

employed to further facilitate this effort.

5.7.2 EXPANSION RISK

The Company‟s strategy includes expansion by continuing to develop products to

supplement its existing core and related businesses. These include; vehicle tracking

services, asset tracking service, container tracking products for Pakistan Customs and

navigation products for automobile and mobile sector. The risk is that the Company may be

expanding too fast.

MITIGANT

Management is cautious of the risks associated with the aggressive expansion plans set

forth by the Company. To mitigate the risk, the management has taken appropriate

measures.

5.7.3 COMPETITION RISK

TPL Trakker currently dominates the asset tracking service industry in Pakistan and is the

leading service provider in the areas of vehicle tracking, fleet management, portfolio

management and vehicle recovery services. Notwithstanding the market leader position of

the Company, the entry of a new player(s) with the direct or indirect support of an

international player might enhance the level of competition in the industry in the long run

and affect Company‟s market share in future.

MITIGANT

While there is threat of new entrants, TPL Trakker‟s strong brand recognition, market

know-how and superior IT and support infrastructure which has enabled it to beat the

competition and enjoy a dominant position in the asset tracking service market in Pakistan.

Any new entrant into asset tracking service market in Pakistan at this stage or in future will

have to make substantial investment of resources and of time to match Company‟s

infrastructure.

5.7.4 INFLATION RISK

The Company is open to inflation risk like that of the whole economy. Inflation risk may be

translated to erosion of values vis-à-vis foreign currency exchange fluctuations. There is a

possibility that the value of assets or income of the Company may decline as increasing

inflation shrinks the purchasing power of the Pakistan Rupee.

MITIGANT

The anticipated inflation is not likely to be a serious risk to the operations of the Company.

The Company is well placed to manage its inflation risk due to effective risk management,

future expansion plans in international markets and introduction of innovative products.

5.7.5 SHARE MARKET PRICE RISK

This is the risk that the share price of the Company may decline due to bearish trends at the

Stock Exchange. In addition, the risk can get amplified if the Company fails to maintain

satisfactory growth.


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MITIGANT

This risk is mitigated by impressive growth performance of the Company. Expansion of

Company‟s asset tracking services will ensure that the growth momentum is maintained

and the share price offers an attractive return to potential investors.

5.7.6 LIQUIDITY RISK

The investors assume the risk that they will not be able to sell the shares in the secondary

market without adversely affecting the market price.

MITIGANT

Ordinary shares are proposed to be listed on KSE which would enable the investors to trade

their shares.

5.7.7 CAPITAL MARKET RISK

The shares of TPL Trakker will be listed on the KSE and the shareholders of the Company

will be able to sell or buy shares only through the members of the KSE subsequent to the

Public Issue. Price of shares will depend on the stock market behavior and performance of

the Company. Hence, price may rise or fall and result in increase or decrease in the value of

shares.

MITIGANT

The Company is likely to perform well in the future due to its growing client base, strong

brand name, experienced management and use of superior technology. Improvement in

overall performance of the Company will result in higher returns to investors.

5.7.8 UNDER SUBSCRIPTION RISK

This is the risk that the Public Issue may get under-subscribed on account of lack of

investors‟ interest.

MITIGANT

The issue is attractively priced at PKR 10/- per share. The Company has an impressive

brand image. The probability of under-subscription is therefore considered low. The public

issue is fully underwritten by commercial banks and other financial institutions.

5.7.9 TECHNOLOGY OBSOLESENCE RISK

This is the risk that the technology being used by the Company for asset tracking becomes

obsolete due to continuous advancement in the technological sector globally.

MITIGANT

The company has established a Research and Development department which is

continuously developing new products to meet the needs of the tracking. Further, the

Company is in the business of tracking for more than a decade and has always developed

new products to cater the tracking needs of the customers.

5.7.10 REGULATORY RISK

This is the risk that the Company does not adhere to the regulatory requirements of the

regulatory bodies.


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MITIGANT

The Company always ensures that it complies with the regulatory requirements. However,

Pakistan has witnessed a continued phase of economic growth, supported inter alia, by

continuity in investment & economic growth friendly policies. This regime is expected to

continue and adverse shift in the regulatory and policy framework is considered unlikely.

5.7.11 LAW AND ORDER RISK

This is the risk that the law and order situation deteriorates due to any unforeseen event in

the Country.

MITIGANT

The industry that the business operates in is fairly insulated from law and order issues. On

the contrary, worsening law and order has to date not reduced business.

5.7.12 RISK DUE TO PENDING LITIGATION

This is the risk that the petitions filed against the Company are decided against it and the

Company has to pay monetary claims to the petitioner.

MITIGANT

The financial quantum of the risk is kept at Rs. 12 million. The Company through its

internally generated resources can easily meet this commitment if the cases are decided

against it.

NOTE: IT IS STATED THAT ALL MATERIAL RISK FACTORS HAVE BEEN

DISCLOSED AND THAT NOTHING HAS BEEN CONCEALED IN THIS

RESPECT.


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PART 6

6 FINANCIAL INFORMATION

6.1 AUDITORS REPORT UNDER SECTION 53(1) READ WITH CLAUSE 28(1) OF

SECTION 2 OF PART I OF THE SECOND SCHEDULE TO THE COMPANIES

ORDINANCE, 1984 FOR THE PURPOSE OF INCLUSION IN THE PROSPECTUS

OF TPL TRAKKER LIMITED


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6.2 SHARE BREAK-UP VALUE CERTIFICATE


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Management Note

The revised break-up value of the Company on the basis of post-IPO paid up capital is

given below:

Issued, subscribed & paid-up capital 2,172,489,630

Revenue reserve – un-appropriated profit 199,135,798

Total Shareholders‟ Equity 2,371,625,428

Number of Ordinary Shares 217,248,963

Breakup Value per Share of PKR 10/- 10.92


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6.3 AUDITORS CERTIFICATE ON ISSUED, SUBSCRIBED, AND PAID-UP-

CAPITAL OF THE COMPANY


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6.4 SUMMARY FINANCIAL HIGHLIGHT FOR THE PRECEDING YEARS

*Note: The Company was incorporated on December 04, 2008, therefore highlights from FY 09, to

Dec 2011, have been disclosed.

6.5 FINANCIAL RATIOS FOR THE PRECEDING YEARS

in 000’s FY09* FY10 FY11

Half year

ended

Dec. 2011

Total Paidup Capital 1,872,489 1,872,489 1,872,489 1,872,489

Reserves 27,481 86,286 178,555 199,136

Total Equity 1,899,970 1,958,775 2,051,044 2,071,625

Current Assets 827,406 939,798 1,100,433 1,090,655

Non-Current Assets 2,470,348 2,459,660 2,491,397 2,474,809

Total Assets 3,297,755 3,399,459 3,591,830 3,565,465

Total Liabilities 1,397,784 1,440,683 1,540,785 1,493,839

Net Sales 213,773 821,546 832,523 440,723

Profit / (Loss) Before Tax 38,841 89,853 125,466 31,973

Profit / (Loss) After Tax 27,480 58,805 92,268 20,580

FY09 FY10 FY11 Dec. 2011 (HY)

RoE (%) 1.45 3.00 4.50 1.00

RoA (%) 0.83 1.73 2.57 0.58

EPS (PKR) 0.34 0.31 0.49 0.11

BVPS (PKR) 10.15 10.46 10.95 11.06


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PART 7

7 MANAGEMENT

7.1 BOARD OF DIRECTORS OF THE COMPANY

Sr.

No. Name & Address Designation Directorship in Other Companies

1)

Mr. Jameel Yusuf S.St.

39-K, Block-6, PECHS, Karachi

Chairman / Director

TPL Holdings (Pvt) Ltd

TPL Direct Insurance Ltd

TPL Properties (Pvt.) Ltd

2)

Mr. Mohammad Ali Jameel


CEO / Deemed

Director

TPL Holdings (Pvt.) Ltd



TPL Security Services (Pvt.) Ltd

TPL Financial Consultancy (Pvt.)

Ltd

Trakker Energy (Pvt.) Ltd

Habib Asset Management Limited

TRG Pakistan Limited

Genco Holdings (Pvt) Ltd

3)

Mr. Saad Nissar

172-B Tariq Road,

2nd floor, Najeeb Centre, Karachi

Director TPL Direct Insurance Limited

EVAC Pakistan (Pvt.) Limited

4)

Mr. Hussein Mohammad Ali

Bhai

Razaque Limited

255 Duncan Mill Road, Suite #

605, Don Mills Ontario M3B 3H9,

Toronto, Canada

Director

Razzaque Limited, Canada

Razzaque Razno Trading (Pvt.) Ltd

5)

Mr. Murtaza Ali Bhai

255 Duncan Mill Road, Suite #

605, Don Mills Ontario M3B 3H9,

Toronto, Canada

Director Razzaque Limited, Canada

Razzaque Razno Trading (Pvt.) Ltd

6)

Mr. Barend Christoffel

Esterhuyzen

Digicore International (Pty) Ltd

9 Regency Drive, Route 21

Corporate Park, Irene Ext 30,

Centurion, South Africa

Director

DigiCore Holdings Ltd, South

Africa

Luna Holdings, United States

7)

Mr. Stuart Aberdein

Digicore International (Pty) Ltd

9 Regency Drive, Route 21

Corporate Park, Irene Ext 30,

Centurion, South Africa

Director

DigiCore Holdings Ltd, South

Africa

DigiCore Electronics (Pty) Ltd,

South Africa

8)

Mr. Mustafa Ali


Company Secretary

/ Director




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7.1.1 Out of 7 elected directors, 5 directors (mentioned at Sr. no. 1, 3 to 5 & 8) are nominees of

TPL Holdings (Pvt) Ltd and 2 directors (mentioned at Sr no 6 & 7)are nominees of

Digicore International (Pty) Limited, South Africa.

7.2 OVER DUE LOANS

There are no overdue loans (local or foreign currency) on the Company or its Directors.

7.3 DIVIDEND PAYOUT BY GROUP LISTED COMPANIES

TPL Direct Insurance Limited is the only Group Company of TPL Trakker which is listed

on the Karachi Stock Exchange. TPL Direct Insurance Limited was listed at KSE in

September 2011. TPL Direct Insurance has announced a 5% cash dividend in the board

meeting held on March 5th, 2012. The book closure of the company is 20

th April, 2012. The

market price of TPL Direct Insurance Limited stood at Rs. 11.23.as on 19th April 2012..

7.4 PROFILE OF DIRECTORS

Mr. Jameel Yusuf S.St. – Chairman

Mr. Jameel Yusuf Ahmed is a businessman by profession and is the chairman of TPL

Holdings. He was the founder Chairman of Citizen-Police Liaison Committee (CPLC), and

remained its Chairman from 1st September 1989 to 22

nd March 2003. The CPLC was

established by the Sindh Government after amending the Police Rules. It is a non-political

statuary institution, operationally independent and managed by dedicated and concerned

citizens offering their honorary services, invested with powers of Magistrate (Honorary) of

the first class. Since its inception in 1989 it has made credible strides with envious

achievements in assisting the victims of crime in the provision of justice and combating /

detecting criminal cases successfully with the help of the community and access to modern

scientific techniques. He is also the Director of Asia Crime Prevention Foundation (ACPF), Japan since 1997 and

is the founding trustee of “PANAH” a shelter home established for women in distress

within the Ida-Rieu premises and now within the Ex-Darul-Aman premises handed over to

Panah Trust by the Government of Sindh, Karachi. Mr. Yusuf is a member, Advisory

council Fellowship Fund for Pakistan (FFFP), Woodrow Wilson International Centre for

Scholars (WWC) since 2004.

Mr. Yusuf was awarded Presidential Award “Sitar-e-Shujaat (S.St.)” for gallantry services

on 14th August, 1992. He was awarded many National and International awards, as well as

being nominated for the First United Nations Vienna Civil Society Award in 1999.

Mr. Mohammad Ali Jameel – CEO & Deemed Director

Mr. Ali Jameel is the CEO of TPL Trakker Ltd., Pakistan's first vehicle tracking Company.

He is also the Director of TRG Pakistan Limited. Formerly, Mr. Jameel was the Chief

Executive of Jahangir Siddiqui Investment Bank. He is a also member of Executive

Committee, Board of Investment, Economic Advisory Council (EAC), the Reform Co-

ordination Group (TRCG) of FBR, Advisory Committee of the Federal Tax Ombudsman

and Genco Holding Company. He has also held several advisory posts in the Pakistan‟s

information technology and telecommunication sectors, including appointments on the

Task Force on Telecom Deregulation, the Fiscal Incentives group on the IT Commission

and the Task Force on Venture Capital.

Mr. Jameel received his B.Sc. degree in Economics from the London School of Economics.

He is also an Associate Member of the Institute of Chartered Accountants in England &

Wales and qualified in 1994 at KPMG Peat Marwick in London.


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Mr. Saad Nissar – Director

Mr. Saad Nissar is an experienced marketing professional. He joined TPL Trakker Limited

in the year 2000 as National Sales Manager. Mr. Nissar has been instrumental in the setting

up and executing retail network nationwide, successful packaging and promoting of fleet

management and portfolio management services in the corporate sector and Financial

Institution Group (FIG) of Pakistan respectively. Mr. Nissar was appointed as Director of

TPL Direct Insurance Limited effective July 2005 and assumed the position of CEO of TPL

Direct Insurance Limited. Mr. Nissar holds MBA degree in Marketing from Institute of

Business Administration.

Mr. Mustafa Ali – Director

Mr. Mustafa Ali is a qualified Cost and Management Accountant with over 10 years of

experience in construction and automobile sector. He started his career in 1991 as Manager

Finance & Administration in Baltistan Trading & Contracting Co. (Pvt.) Ltd. In 2000, he

joined, Ghandhara Nissan Diesel Ltd. as Manager Finance before joining Trakker Group in

2001 as Finance Manager. Under his supervision, Trakker has maintained a sound financial

position despite the multifaceted nature of its services. Currently he is serving as Vice

President Finance in TPL Holdings.

Mr. Murtaza Ali Bhai - Director

Mr. Murtaza Ali Bhai is a Cost and Management accountant from UK and Canada. He is a

businessman by profession and has valuable experience for trading and transportation

business since 1970. Mr. Ali Bhai was born in Africa and then migrated to Pakistan,

associated with various types of businesses which includes imports and industrial

commodities, he is also the Director of Razzaque Limited and Razzaque Razno Trading

(Pvt) Limited.

Mr. Hussein Ali Bhai - Director

Mr. Hussein Ali Bhai, a businessman by profession since 1969, born in Africa and then

migrated to Pakistan. Mr. Ali Bhai is associated with various types of businesses which

includes imports and industrial commodities, he is also the Director of Razzaque Limited

and Razzaque Razno Trading (Pvt) Limited.

Mr. Stuart Robin Aberdein - Director

Mr. Stuart is bachelors in Business Science. After completing his studies at the University

of Cape Town, Stuart served articles with Spencer Steward in Cape Town. He then worked

for 10 months as an audit senior for Binder Hamlyn in London in 1984 and 1985. He joined

Kivtronics as Managing Director in 1986 and was appointed a director of DigiCore

Holdings after Kivtronics was bought by that company prior to its listing on the JSE in

1998.

He is currently working as Managing Director of DigiCore Electronics (Pty) Ltd. and an

Executive Director of DigiCore Holdings Ltd.

Mr. Barend Christoffel - Director

Mr. Barend as an entrepreneur established, controlled and actively managed various

companies in diverse industries over the past 30 years. He has chaired and/or served on

boards of various companies over the years; including the JSE & Luxembourg listed SAIL


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Group Limited for which he was executive Chairman until 2003 and JSE listed companies,

DigiCore Holdings Limited and Sallies Limited, amongst other.

Mr. Barend has in chief executive capacity successfully led various management teams of

different cultures in the day to day management of businesses spanning various countries

over the years.

He currently serves as the Group managing director for DigiCore, with special focus on

acquisitions and building the international business.

7.5 PROFILE OF OTHER KEY MANAGEMENT PERSONNEL

Mr. Ahsan Sarwar – Executive Director

Mr. Ahsan Sarwar has been associated with TPL Trakker Limited since April 2000. He is

currently heading the Operations of TPL Trakker as Executive Director. Having extensive

experience of Customer Services and Call Centre, he also holds a Bachelor degree in

Commerce.

Mr. Sarwar is skilled in analyzing existing operations and implementing the strategies,

processes and technologies for improved efficiency. An energetic, multi-tasking manager

with extensive knowledge in directing operations, his expertise are in developing strong

customer / employee relationships leading to increased business productivity and

profitability.

Mr. Adnan Khandwala – Chief Financial Officer (CFO)

Mr. Adnan Khandwala is a qualified Chartered Accountant with over 10 years of

experience in automobile, textile and service sector. He completed his articles from Ernst &

Young Ford Rhodes Sidat Hyder Chartered Accountants and started his career in 2005 as

Manager Finance in AB Engineering. (Pvt.) Ltd. In 2006, he joined Artistic Garment

Industries (Pvt) Ltd. as Chief Internal Auditor before joining TPL Trakker in 2007 as AVP

Finance.

Mr. Muhammad Umair – Head of IT

Mr. Muhammad Umair oversees Company‟s IT team for major IT Projects, providing

strategic direction and management for the company‟s IT infrastructure. He leads a team of

IT professionals who are delivering the long term solutions of software and networks for

TPL.

Mr. Umair has more than 12 years of experience leading large-scale IT Organization.

Before joining TPL, Muhammad Umair was S. Manager of Takaful Pakistan, where he

oversaw corporate information technology services for the company‟s national and

international offices.

Mr. Umair holds a bachelor‟s degree from Sir Syed University of Engineering &

Technology in electronics and MS Networking.

Mr. Faheem Ur Rehman – Head of Technical

Mr. Faheem ur Rahman is a highly skilled and dedicated engineering professional having

15 years of experience in Quality Management, Computerized Maintenance Management

System (CMMS), Plant Erection and Production Management in Hino Motors, Phillips

Whirlpool, Unilever Pakistan Ltd. and TPL Trakker Ltd. He holds a 4 years specialized

diploma from Pak Swiss Training Centre with the capacity of Instrumentation and Dies &

Mould Technology. Also he has done a Bachelor degree in Computer Sciences, Strong

desire to work and excel further using professional and analytical expertise.


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Mr. Waqar Mohammad – Head of Sales

Mr. Waqar Mohammad holds a degree in Mechanical Engineering and MBA. He has over

16 years of diversified sales experience. A result oriented sales professional with talent to

identify gaps and develop relevant strategies to maximize growth and company's top line.

He has been part of two successful launch teams in Telenor and wi-tribe. Before joining

TPL trakker, he was head of retail sales in wi-tribe.

Mr. Furqan Saeed Khan – Vice President Operations

Mr. Furqan Saeed Khan has been associated with TPL Trakker since April 2008. He is

bachelors in Business Studies. As an Operations / Customer Care professional for over 18

years, with high-level management experience in various industries including BPO,

Insurance , Manufacturing and Services in Pakistan, UAE and UK, Mr. Khan specializes in

process re-engineering and adept at managing all levels of operations and infrastructure

from needs assessment through implementation with an aptitude for strategic thought and

planning, and the ability to enhance services through automation processing which has

allowed him to achieve consistent and significant successes in multiple industries.

He further specializes in Call Center Solutions, CRM‟s and Data Management Tools which

gives him a cutting edge in backend and front end operational management

7.6 NUMBER OF DIRECTORS

Pursuant to Section 174 of the Companies Ordinance, 1984 the Company shall not be less

than seven directors. At present the Board consists of 7 Directors, and the Chief Executive

Officer.

7.7 QUALIFICATION OF DIRECTORS

No qualification shares are prescribed for becoming a director of the Company. However,

as per section 187 of the Ordinance, the director is to be a member of the Company. This

condition does not apply to the nominee directors.

7.8 REMUNERATION OF THE DIRECTORS

No remuneration is payable to non-Executive Directors. However, Executive Directors,

performing whole time duties, are paid remuneration as per the approval by the Board of

Directors.

7.9 BENEFITS TO PROMOTERS AND OFFICERS

No amount of benefits has been paid or given during the last year or is intended to be paid

or given to any promoter or to any officer of the Company other than as remuneration for

services rendered as whole-time executive of the Company.

7.10 INTEREST OF DIRECTORS

The directors may be deemed to be interested to the extent of fees payable to them for

attending Board meetings. The Directors performing whole time services in the Company

may also be deemed interested in the remuneration payable to them by the Company.

The nominee directors have interest in the Company to the extent of representing the

sponsors in the capital of the Company.


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7.11 INTEREST OF DIRECTORS IN PROPERTY ACQUIRED BY THE COMPANY

None of the Directors of the Company had or has any interest in any property acquired by

the Company or proposed to be acquired by the Company.

7.12 ELECTION OF DIRECTORS

The Directors of the Company are elected for a term of three years in accordance with the

procedure laid down in section 178 of the Ordinance.

The Directors shall comply with the provisions of Sections 174 to 178 and Sections 180

and 184 relating to the election of Directors and matters ancillary thereto.

Subject to the provisions of the Ordinance, the Company may from time to time increase or

decrease the number of Directors.

Any casual vacancy occurring on the Board of Directors may be filled up by the Directors,

but the person so appointed shall be subject to retirement at the same time as if he/she had

become a Director on the day on which the Director in whose place he/she is chosen was

last elected as Director.

The Company may remove a Director in accordance with the provisions of the Ordinance.

Three Directors of the Company were elected on 29 June, 2009 for term of three (3) years

(when the Company was a private Company). Four directors have been co-opted on 19

October, 2009, to comply with the requirement of the Ordinance. The term of the Board of

Directors will expire on June 28, 2012.

7.13 VOTING RIGHTS

At any general meeting, a resolution put to the vote of the meeting shall, unless a poll is

demanded, be decided on a show of hands unless a poll is (before or on the declaration of

the result of the show of hands) demanded. Unless a poll is so demanded, a declaration by

the chairman that s resolution has, on a show of hands, been carried, or carried

unanimously, or by a particular majority, or lost, and an entry to that effect in the book of

the proceedings of the Company shall be conclusive evidence of the fact, without proof of

the number or proportion of the votes recorded in favour of, or against, that resolution.

A poll may be demanded only in accordance with the provision of section 167 of the

Ordinance. If a poll is duly demanded, it shall be taken in accordance with the manner laid

down in section 168 of the Ordinance and the result of the poll shall be deemed to be

resolution of the meeting at which the poll was demanded

7.14 AUDIT COMMITTEE / CONSTITUTION OF AUDIT COMMITTEE

Audit Committee of the Board will be constituted after listing on KSE to comply with the

Code of Corporate Governance which requires that:

(a) The Audit Committee meeting shall be held after the Company is listed on KSE, as

per provisions of the Code of Corporate Governance.

(b) The Audit Committee will have its terms of reference as determined by the Board of

Directors in accordance with the guide lines provided in the Listing Regulations.


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7.15 INTERNAL AUDIT

The Board of Directors has setup an effective internal audit function managed by suitable

qualified and experienced personnel who are conversant with the policies and procedures of

the Company and are involved in the internal audit function on a full time basis.

7.16 BORROWING POWERS

The Directors may from time to time at their discretion borrow and secure the payment of

any sum or sums of money for the purposes of the Company and may themselves lend to

the Company on security or otherwise subject to the provisions of Companies Ordinance,

1984.

7.17 POWERS OF DIRECTORS

The business of the Company shall be managed by the Directors, who may pay all expenses

incurred in promoting and registering the Company, and may exercise all such powers of the

Company as are not by the Ordinance or by the Articles, required to be exercised by the

Company in General Meeting.

7.18 INVESTMENTS IN ASSOCIATED COMPANIES

The Company has made an investment of PKR 85,030,449 in 1,644 ordinary shares of

AED 1,000 each in Trakker Middle East LLC, representing 29% of the share capital. The

Company has also made an investment of PKR 450,000,000 in 45 million ordinary shares

of Rs. 10 each in TPL Properties (Pvt.) Limited, representing 41% of the share capital.

Digicore International (Pty) Limited, South Africa, (Digicore) is an associated company by

virtue of common directorship only. The Company does not have any investment in the

said company. Digicore holds 30% share capital of the Company.

7.19 ADVANCE TO ASSOCIATED COMPANIES

The Company has extended advance to its associated companies under section 208 of the

Companies Ordinance 1984. In this regard, an Extra Ordinary General Meeting was held on

January 7, 2012 and in the meeting, it was resolved as under:

1) The Company may make advance to TPL Holdings (Pvt) Limited subject to maximum

amount of Pak Rs. 150 Million. The advance will be subject to the following terms &

conditions:

a) The investment period will expire on 30-06-2020.

b) Such advance shall be unsecured and shall be given from time to time as per

requirement of TPL Holdings (Pvt.) Ltd. in a way that maximum amount must not

increase Pak Rs. 150 Million. Thus the advance shall be a floating advance.

c) The mark-up will be charged equivalent to the borrowing cost of company on the

outstanding balance. This markup will be revised / reviewed in case any change

occurs in the borrowing cost of M/s. TPL Trakker Limited.

2) Further RESOLVED that the Company may make advance to TPL Properties (Pvt.)

Limited subject to maximum amount of Pak Rs. 200 Million. The advance will be

subject to the following terms & conditions:

a) The investment period will expire on 30-06-2020.


85

b) Such advance shall be unsecured and shall be given from time to time as per

requirement of TPL Properties (Pvt.) Ltd. in a way that maximum amount must not

increase Pak Rs. 200 Million. Thus the advance shall be a floating advance.

c) The mark-up will be charged equivalent to the borrowing cost of company on the

outstanding balance. This markup will be revised / reviewed in case any change

occurs in the borrowing cost of M/s. TPL Trakker Limited

7.20 INVESTMENT IN SUBSIDIARIES

The Company has made investments in following subsidiary companies as at 31st

December, 2011:

Name of Company %age Shareholding Amount Invested

(PKR)

TPL Direct Insurance Limited 67.39% 635,583,541

TPL Security Services (Pvt) Ltd 99.9% 37,749,000


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PART 8

8. MISCELLANEUOS INFORMATION

8.1 REGISTERED OFFICE / CORPORATE OFFICE

TPL Trakker Limited

39/k, Block-6, P.E.C.H.S. Karachi, Pakistan

Phone: (021) – 3439 0300

Fax: (021) - 3452 9429

8.2 BANKER TO THE ISSUE FOR BOOK BUILDING

Faysal Bank Limited

8.3 BID COLLECTION CENTRE

Karachi

Contact Officer: Mr. Ahmed Zeeshan Direct No.: +92-21-32462597 Fax No.: +92-21-32429653 Email: [email protected] Postal Address: Arif Habib Limited Arif Habib Centre 23, M.T. Khan Road, Karachi

Contact Officer: Mr. Syed Khurram Shahid Direct No.: +92-21-35374301 Mobile No.: +92-333-310-4756 PABX No.: +92-21-111-253-111 Ext: 636 Fax No.: +92-21-35867992; 92-21-35869715 Email: [email protected] Postal Address: AKD Securities Limited 6

th Floor, Continental Trade Centre

Block 8, Clifton, Karachi Lahore

Contact Officer: Mr. Ehsan Ahmad Qureshi Direct No.: +92-42-36280742, +92-42-36280743, +92-42-36280744 Mobile No.: +92-334-411-1253 PABX No.: +92-42-111-253-111 Fax No.: +92-42-36280745 Email: [email protected]

Postal Address: AKD Trade Room No. 512/513, 5

th Floor,

Lahore Stock Exchange Building, Lahore.

Islamabad

Contact Officer: Mr. Khalid Hussain Direct No.: +92-51-2894325 Mobile No.: +92-332-2125525 PABX No.: +92-51-111-253-111 Fax No.: +92-51-2894323 Email: [email protected]

Postal Address: AKD Trade 303, 3

rd Floor, ISE Towers, Jinnah Avenue

Blue Area, Islamabad






87

8.4 MAJOR BANKS OF THE COMPANY

Standard Chartered Bank


Habib Metropolitan Bank

8.5 AUDITORS OF THE COMPANY

Ernst & Young Ford Rhodes Sidat Hyder

Chartered Accountants

Progressive Plaza, Beaumont Road

P.O.Box 15541, Karachi, Pakistan

8.6 BANKERS TO THE ISSUE

Faysal Bank Limited

KASB Bank Limited

Habib Metropolitan Bank Limited

Bank Al-Habib Limited

Standard Chartered Bank

Habib Bank Limited

JS Band Limited

Muslim Commercial Bank

NIB Bank Limited

United Bank Limited

8.7 LEGAL ADVISOR OF THE COMPANY

Mohsin Tayebaly & Co,

2nd

Floor Dine Centre, BC-4

Block 9, Kehkashan, Clifton, Karachi

Phone: (021) – 3537 5658-59

Fax: (021) – 3587 70240

8.8 LEGAL ADVISOR TO THE ISSUE

Mohsin Tayebaly & Co

2nd

Floor Dine Centre, BC-4

Block 9, Kehkashan, Clifton, Karachi

Phone: (021) – 3537 5658-59

Fax: (021) – 3587 70240

8.9 JOINT BOOK RUNNERS

AKD Securities Limited

6th Floor, Continental Trade Centre,

Block 8, Clifton

Karachi


88

Arif Habib Limited

2nd Floor, Arif Habib Centre,

23 M.T. Khan Road,

Karachi

8.10 JOINT LEAD MANAGERS & ARRANGERS


1st Floor, NBP Head Office,

I.I.Chundrigar Road,

Karachi

AKD Securities Limited

6th Floor, Continental Trade Centre,

Block 8, Clifton

Karachi

Arif Habib Limited

2nd Floor, Arif Habib Centre,

23 M.T. Khan Road,

Karachi

8.11 SHARES REGISTRAR

THK Associates (Pvt.) Limited

Ground Floor, State Life Building No. 3,

Dr. Ziauddin Ahmed Road,

Karachi

8.12 MATERIAL CONTRACTS/ DOCUMENTS

8.12.1 DETAILS OF SHORT TERM FINANCE FACILITIES

Running Finance Facility

S.No Bank

Facility

Amount

(PKR 000)

Rate

Date

Sanctioned

1 Habib Metropolitan Bank

Limited

175,000 3 Month KIBOR +

2.1%

02

February

2007

2 Standard Chartered Bank

(Pakistan) Limited

60,000 3 Month KIBOR +

3%

11 June

2009

3 National Bank of Pakistan 150,000 3 Month KIBOR +

3.5%

23 June

2010

Total 385,000


89

8.12.2 DETAILS OF LONG TERM FINANCING FACILITY

Ijarah / Leasing Facility

S.No Bank

Facility

Amount (PKR

000)

Rate

Expir

y

Date

1 Habib Bank Limited 20,000 6 Month KIBOR + 2.5% 2014

2 First Habib Modarba Limited 32,072 6 Month KIBOR + 2.5% to

3%

2013

3 NBP Leasing 37,570 6 Month KIBOR + 2.5% to

3%

2014

4 Standard Chartered Modarba 8,800 6 Month KIBOR + 2.7% 2014

Total 98,442

Term Loan Facility

S.No Bank Facility Amount

(PKR 000) Rate

1 Habib Metropolitan Bank Ltd 100,000 3 Month KIBOR + 1.5%

Total 100,000

\

8.13 UNDERWRITING AGREEMENTS

S.No Underwriters No. of Shares Date of Agreement

1 National Bank of Pakistan 500,000 May 15, 2012

2 AKD Securities Limited 5,000,000 May 15, 2012

3 Invest Capital Markets Limited 3,500,000 May 15, 2012

4 PAIR Investment Company Limited 1,000,000 May 10, 2012

Total 10,000,000

8.14 DUE DILIGENCE REPORTS

S.No Underwriters Date of Agreement

1 National Bank of Pakistan May 15, 2012

2 AKD Securities Limited May 15, 2012

3 Invest Capital Markets Limited May 15, 2012

4 PAIR Investment Company Limited May 10, 2012

8.15 COMPANY RELATED AGREEMENTS

Contractor/Vendor Date Description

Pakistan Telecom Mobile

Limited (PTML)

1-Oct-2009

Renewal Date

13-Feb-2012

Under this agreement TPL utilizes the PTML

connections in their tracking devices and

provide tracking services to its customers

through GSM/ GPRS services being availed.

Pakistan Mobile 1-July-2011 Under this agreement TPL utilizes the PMCL


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Communication Limited

(PMCL)

connections in their tracking devices and

provide tracking services to its customers

through GSM/ GPRS services being availed.

GlobalTrak 1-July-2010 GlobalTrak is an information services

company that utilizes mobility technologies

and advanced cargo sensors to deliver real-

time situational awareness and intelligence to

help companies perform better and improve

business processes and operations.

The agreement grants TPL exclusive authority

to resell the globaltrak units.

DigiCore International

(Proprietary) Limited

23-May-1999 This is a shareholders agreement between the

Pakistani promoter, namely Mr. Ali Jameel,

Mr. Jameel Yusuf, Mr. Muslim Hassan Ali,

Mr. Hussein Ali Bhai and Digicore

International (Pty) Limited, South Africa

(Digicore). Under this agreement Pakistani

promoters hold 70% and Digicore holds thirty

percent (30%) of the total issued capital of the

Company. The agreement gives pre-emptive

rights in proportion to the number of shares of

the Company held by these shareholders.

Under the agreement, Digicore provides the

following products and services to the

Company;

1. C-track units

2. Technical facilities

3. Training facilities

Scheme of Arrangement

with TPL Holdings (Pvt.)

Limited

7-May-2009 On March 31, 2009, the Company entered

into a Scheme of Arrangement with TPL

Holdings (Pvt) Limited The Scheme was

approved / sanctioned by the Honorable High

Court of Sindh vide its Order preference

number J.M.No. 21/2008 dated May 07, 2009

and was in accordance with section 284 to

287 of the Companies Ordinance, 1984.

Accordingly:

- The entire undertaking of

TPL Holdings (Pvt) Limited,

including assets, liabilities,

rights and obligations, other

than Trakker Energy (Pvt)

Limited were transferred to

and vested in the Company

- In consideration for the

restructuring under the

Scheme, the Company issued

and allotted 131,074,274

ordinary shares of PKR 10/-

each as fully paid up to TPL

Holdings Pvt Limited

equivalent to 70 % of the

issued and paid up capital the

Company and 56,174,689


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ordinary shares to Digicore,

equivalent to 30% of the

issued and paid up capital of

the Company.

8.15.1 REGULATORY APPROVAL

Company has been granted approval by Pakistan Telecommunication Authority (PTA),

Government of Pakistan, for vehicle tracking facility vide license no. DIR (L)/CVAS-

105/PTA/2006 dated: June 06, 2006.The license is valid upto 22nd

November 2014 and is

renewable for a period of 15 years. The Company has obtained no objection on the change

of management from PTA for utilization of license via letter PTA/Wireline

Licensing/Trakkers/25/2009 dated 25 August 2011.

8.16 INSPECTION OF DOCUMENTS AND CONTRACTS

Copies of the Memorandum and Articles of Association, the audited financial statements,

the Auditor‟s Certificates, Information Memorandum and copies of agreements referred to

in this Prospectus may be inspected during usual business hours on any working day at the

registered office of the Company from the date of publication of this Prospectus until the

closing of the subscription list.

8.17 LEGAL PROCEEDINGS

There are ordinary routine litigation incidental to the business, to which the Company or its

subsidiary/ (ies) is a party. However, none of them are any material except for the matters

disclosed in Auditor‟s Report under section 53(1) produced in Para 5 of this document. In

all the matters the Company expect positive outcome.

In addition to the litigations disclosed in the Audited Report, the Company is also party to

following litigation proceedings (which is fully provided for in the Audited Financial

Statements)

a. Geoflzyka Krakow Limited vs M/s TPL Trakker Limited

This is a winding up petition (No 14 Dated 2011.) filed against the company in the

High Court of Sindh wherein the petitioner has stated that an agreement was

executed between the parties for supply, installation and commissioning of vehicle

tracking equipment on the petitioner‟s designated vehicles and also for providing

monitoring services. Equipment was installed on the vehicles, however, after some

time the petitioner returned the equipment installed on its vehicles and asked the

Company for reimbursement of Rs. 10,929,526/- being the price paid for

equipment in respect of returned units as well as unutilized monitoring charges.

The petitioner filed this petition alleging that the company is insolvent and unable

to pay its debts. Counter-affidavit to the petition has been filed by the Company

and the matter is pending for hearing.

It is pertinent to mention herein that TPL is very well known in Pakistan and it is

the first and largest vehicle tracking company established since 1999 as a joint

venture with South Africa‟s multinational Digicore, which ranks Number 2 for

GPS based tracking and Management solutions, and operates in almost 32

countries worldwide. TPL is the most trusted name in this sector with a client base

over a 100,000 and has until now recovered over 7000 stolen vehicles and

expensive cargo worth over PKR 8 billion. TPL has paid up share capital of PKR

1,872 billion. As at June 30, 2011, TPL total assets were worth over PKR 3.59


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billon. TPL achieved gross revenue of PKR 832 million and post net profit after tax

of PKR 92.00 million for year ended June, 2011.

TPL maintains 100% compliance status with the Federal Board of Revenue.

Regarding its ability to pay the debts this can be substantiated with the latest report

by PACRA , as per which, our long term and short term rating are A- (A minus)

and A2 (A Two) respectively.

b. Abdullah Shahid vs M/s TPL Trakker Limited

Petition filed against the company for the compensation claims due to theft of

petitioner‟s vehicle in which tracking device was installed. However, petitioner car

was snatched and Company was not able to recover the same due to non-reporting

issue. Consumer Court granted the compensation to petitioner and Company has

filed an appeal in honorable high court of Lahore on the grounds that compensation

granted by Consumer Court is unreasonable and outside the scope of section 31 of

the Punjab Consumer protection Act 2005.

c. Muhammad Farooq Khan vs Trakker Private Limited

Petition filed by the terminated employee of the Company for his salary along with

increment and bonuses. Court of Authority under Payment of Wages Act, Multan

has passed a degree of Rs. 375,800/- against the Company for compensation.

However, Company has filed an appeal in honorable high court on the grounds that

compensation granted by Court of Authority under Payment of Wages Act, Multan

is unreasonable.

8.18 MEMORANDUM OF ASSOCIATION

The Memorandum of Association, inter alia, contains the objects for which the Company

was incorporated and the business which the Company is authorized to undertake. A copy

of the Memorandum of Association is annexed to this Prospectus and with every issue of

the Prospectus except the one that is released in newspapers as advertisement.

8.19 FINANCIAL YEAR OF THE COMPANY

The financial year of the Company commences from 1st day of July and ends on the 30th

day of June each year.


93

PART 9

9 APPLICATION AND TRANSFER INSTRUCTIONS

9.1 GENERAL INSTRUCTIONS

9.1.1 ELIGIBLE INVESTORS INCLUDE:

a. Pakistani citizens resident in or outside Pakistan or Persons holding two

nationalities including Pakistani nationality;

b. Foreign Nationals whether living in or outside Pakistan

c. Companies, bodies corporate or other legal entities incorporated or established in or

outside Pakistan (to the extent permitted by their constitutive documents and

existing regulations, as the case may be);

d. Mutual Funds, Provident/pension/gratuity funds/trusts, (subject to the terms of the

Trust Deed and existing regulations); and

e. Branches in Pakistan of companies and bodies corporate incorporated outside

Pakistan.

9.1.2 APPLICATION MUST BE MADE ON THE COMPANY’S PRINTED

FORM

9.1.3 Copies of this Prospectus and applications forms can be obtained from

members of Karachi Stock Exchange (Guarantee) Limited, Lahore Stock

Exchange (Guarantee) Limited and Islamabad Stock Exchange (Guarantee)

Limited, the Bankers to the issue and their Branches, the Joint Lead Manager

& Arrangers & the Joint Book Runners, and the registered office of the

Company. The Prospectus and the application form can also be downloaded

from the following website: www.akdsecurities.net and www.tplworld.com

9.1.4 The applicants opting for scripless form of shares are required to complete the

relevant sections of the application. In accordance with the provisions of the

Central Depositories Act, 1997 and the CDC Regulations, credit of such shares is

allowed ONLY in the applicant‟s own CDC account. In case of discrepancy

between the information provided in the application form and the information

already held by CDS, the Company reserves the right to issue shares in physical

form.

9.1.5 Name(s) and address (es) must be written in full block letters, in English and

should not be abbreviated.

9.1.6 All applications must bear the name and signature corresponding with that recorded

with the applicant's banker. In case of difference of signature with the bank and

CNIC or NICOP or Passport both the signatures should be affixed on the

application form.

9.1.7 APPLICATIONS MADE BY INDIVIDUAL INVESTORS

(i) In case of individual investors, an attested photocopy of CNIC (in case of

Resident Pakistanis)/Passport (in case of Non-Resident Pakistanis) as the

case may be, should be enclosed and the number of CNIC/Passport should

be written against the name of the applicant. Copy of these documents can

be attested by any Federal/Provincial Government Gazetted Officer,

Councilor, Oath Commissioner or Head Master of High School or bank

manager in the country of applicant's residence.

http://www.akdsecurities.net/


94

(ii) Original CNIC/Passport, along with one attested photocopy, must be

produced for verification to the banker to the issue and the applicant‟s

banker (if different from the banker to the issue) at the time of presenting

the application. The attested photocopy will, after verification, be retained

by the bank branch along with the application.

9.1.8 APPLICATIONS MADE BY INSTITUTIONAL INVESTORS

(i) Applications made by companies, corporate bodies, mutual funds,

provident/pension/gratuity funds/trusts and other legal entities must be

accompanied by an attested photocopy of their Memorandum and Articles

of Association or equivalent instrument/document. Where applications are

made by virtue of Power of Attorney, the same should also be submitted

along with the application. Any Federal/Provincial Government Gazetted

Officer, Councilor, Bank Manager, Oath Commissioner and Head Master

of High School or bank manager in the country of applicant's residence can

attest copies of such documents.

(ii) Attested photocopies of the documents mentioned in 8(i) must be produced

for verification to the banker to the issue and the applicant's banker (if

different from the banker to the issue) at the time of presenting the

application. The attested copies, will after verification, be retained by the

bank branch along with the application.

9.1.9 Only one application will be accepted against each account, however, in case

of joint account, one application may be submitted in the name of each joint

account holder.

9.1.10 Joint application in the name of more than two persons will not be accepted. In case

of joint application each applicant must sign the application form and submit

attested copies of their CNICs/Passport. The Shares will be dispatched to the

person whose name appears first on the application form while in case of CDS, it

will be credited to the CDS account mentioned on the face of the form and where

any amount is refundable, in whole or in part, the same will be refunded by cheque

or other means by post, or through the bank where the application was submitted,

to the person named first on the application form, without interest, profit or return.

Please note that joint application will be considered as a single application for the

purpose of allotment of Shares.

9.1.11 Subscription money must be paid by cheque drawn on applicant's own bank

account or pay order/bank draft payable to one of the Bankers to the issue “A/C

Initial Public Offering of TPL Trakker Limited” and crossed “A/C PAYEE

ONLY”.

9.1.12 For the applications made through pay order/bank draft, it would be permissible for

a banker to the issue to deduct the bank charges while making refund of

subscription money to unsuccessful applicants through pay order/bank draft

individually for each application.

9.1.13 The applicant should have at least one bank account with any of the

commercial banks. The applicants not having a bank account at all (non-

account holders) are not allowed to submit application for subscription of

Shares.

9.1.14 Applications are not to be made by minors and/or persons of unsound mind.


95

9.1.15 Applicants should ensure that the bank branch, to which the application is

submitted, completes the relevant portion of the application form.

9.1.16 Applicants should retain the bottom portion of their application forms as

provisional acknowledgement of submission of their applications. This should not

be construed as an acceptance of the application or a guarantee that the applicant

will be allotted the number of Shares for which the application has been made.

9.1.17 Making of any false statements in the application or willfully embodying

incorrect information therein shall make the application fictitious and the

applicant or the bank shall be liable for legal action.

9.1.18 Bankers to the issue are prohibited to recover any charges from the subscribers for

collecting subscription applications. Hence, the applicants are advised not to pay

any extra charges to the bankers to the issue.

9.1.19 It would be permissible for a Banker to the issue to refund subscription money to

unsuccessful applicants having an account in its bank by crediting such account

instead of remitting the same by cheque, pay order or bank draft. Applicants

should, therefore, not fail to give their bank account numbers.

9.1.20 Submission of Fictitious and multiple applications (more than one application by

same person) is prohibited and such application money shall be liable to

confiscation under section 18A of the Securities and Exchange Ordinance, 1969.

ADDITIONAL INSTRUCTIONS FOR FOREIGN/NON-RESIDENT INVESTORS

9.1.21 In case of foreign investors who are not individuals, applications must be

accompanied with a letter on applicant's letterhead stating the legal status of the

applicant, place of incorporation and operations and line of business. A copy of

memorandum of association or an equivalent document should also be enclosed, if

available. Where applications are made by virtue of Power of Attorney, the same

must be lodged with the application. Copies of these documents can be attested by

the bank manager in the country of applicant's residence.

9.1.22 Applicants may also subscribe using their Special Convertible Rupee

Account (SCRA) as set out under the State Bank of Pakistan's Foreign Exchange

Manual.

BASIS OF ALLOTMENT

9.1.23 The basis and conditions of transfer of shares to the general public shall be as

follows:

a) The minimum amount of application for subscription of 500 Shares is PKR 5,000/-.

Application for Shares below the total value of PKR 5,000/- shall not be entertained.

b) Application for Shares must be made for 500 Shares or in multiple thereof only.

Applications, which are neither for 500 Shares nor for multiple thereof, shall be

rejected.

c) Allotment/Transfer of Shares to successful applicants shall be made in accordance

with the allotment criteria/ instructions disclosed in the Prospectus.


96

d) Allotment of Shares shall be subject to scrutiny of applications in accordance with

the criteria disclosed in the Prospectus and/or the instructions by the Securities &

Exchange Commission of Pakistan.

e) Applications, which do not meet the above requirements, or applications which are

incomplete will be rejected. The applicants are, therefore, required to fill in all data

fields in the Application Form.

f) The Company will dispatch Shares to successful applicants through their Bankers

to the issue or credit the respective CDS accounts of the successful applicants (as

the case maybe).

9.2 BANKERS TO THE ISSUE

Code No. Bank

01 Faysal Bank Limited

02 Bank Al-Habib Limited

03 NIB Bank Limited

04 Habib Metropolitan Bank Limited

05 Habib Bank Limited

06 KASB Bank Limited

07 JS Bank Limited

08 United Bank Limited

09 MCB Bank Limited

10 Standard Chartered Bank

9.3 CODE OF OCCUPATION

Code No. Occupation Code No. Occupation

01 Business 06 Professional

02 Business Executive 07 Student

03 Service 08 Agriculturist

04 Housewife 09 Industrialist

05 Household 10 Others

9.4 NATIONALITY CODE

Code No. Name of country Code No. Name of country

001 U.S.A 006 Bangladesh

002 U.K 007 China

003 U.A.E 008 Bahrain

004 K.S.A 009 Other

005 Oman


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PART 10

11. BIDDING FORM OF TPL TRAKKER LIMITED

(this space has been left intentionally)


98

PART 11

12. SIGNATORIES TO THE PROSPECTUS

Mr. Jameel Yusuf

-Sd-

Mr. Mohammad Ali Jameel

-Sd-

Mr. Saad Nissar -Sd-

Mr. Hussein Mohammad Ali Bhai -Sd-

Mr. Murtaza Ali Bhai

-Sd-

Mr. Barend Christoffel Esterhuyzen

-Sd-

Mr. Stuart Aberdein

-Sd-

Mr. Mustafa Ali

-Sd-

Signed by the above in the presence of witnesses :

Sd/-

Name: Adnan Khandwala

CNIC: 42201-4970473-7

Address:39-K, Block-6, PECHS Karachi

Designation: Chief Financial Officer

Date: 21 April 2012

Place:Karachi

Sd/-

Name: Muhammad Abbas

CNIC: 42301-5321910-7

Address: 39-K, Block-6, PECHS Karachi

Designation: Manager Finance

Date: 21 April 2012

Place: Karachi


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PART 12

13. MEMORANDUM OF ASSOCIATION


100


101


102


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