Project Report

On

( PAKISTAN TELECOMMUNICATION COMPANY LIMITED )

By

MOAZAM IFTIKHAR & SYEDA SEEMAB

Department Of Business Management

Faculty Of Sciences
Faisalabad Institute Of Textile &Fashion Design
Faisalabad
 “An project report submitted to

in partial fulfillment of the

requirement for Bachelor in Business & Administration ”

“To our whose unconditional love & support helped us in

making this project . To my Teacher for their

corporation and assistance. To our siblings for their gentle encouragement

& valuable support”

• VISION
• MISSION
• INTRODUCTION
• HISTORICAL BACKGROUND
• DIRECTOR & SECRETARY
• BOARD OF DIRECTORS
• MANAGEMENT SUMMARY
• PROGRESS SUMMARY
• ANALAYSIS OF PERFORMANCE
• PERFORMANCE MEAURES
• INVESTMENT ANALAYSIS
• FINANCIAL ANALAYSIS
Introduction
From the humble beginnings of Posts & Telegraph Department in
1947 and establishment of Pakistan Telephone & Telegraph
Department in 1962, to this very day, ours is a story of commitment
and vision.

Pakistan Telecommunication Corporation

(PTC) set sails for its voyage of glory in
December 1990, taking over operations
and functions from Pakistan Telephone
and Telegraph Department under Pakistan
Telecommunication Corporation Act 1991. This coincided with the
Government's competitive policy, encouraging private sector
participation and resulting in award of licences for cellular, card-
operated payphones, paging and, lately, data communication
services.

Pursuing a progressive policy, the Government in 1991, announced

its plans to privatize PTC, and in 1994 issued six million vouchers
exchangeable into 600 million shares of the would-be PTCL in two
separate placements. Each had a par value of Rs. 10 per share.
These vouchers were converted into PTCL shares in mid-1996.

In 1995, Pakistan Telecommunication (Reorganization) Ordinance

formed the basis for PTCL monopoly over basic telephony in the
country. It also paved the way for the establishment of an
independent regulatory regime. The provisions of the Ordinance were
lent permanence in October 1996 through Pakistan
Telecommunication (Reorganization) Act. The same year, Pakistan
Telecommunication Company Limited was formed and listed on all
stock exchanges of Pakistan

Since then, PTCL has been working vigorously to meet the dual
challenge of telecom development and socio-economic uplift of the
country. This is characterized by a clearer appreciation of ongoing
telecom scenario wherein convergence of technologies continuously
changes the shape of the sector. A measure of this understanding is
progressive measures such as establishment of the company's
mobile and Internet subsidiaries in 1998.

As telecommunication monopolies head towards an imminent end,

services and infrastructure providers are set to face even bigger
challenges. Pakistan also entered post-monopoly era with
deregulation of the sector in January 2003. On the Government level,
a comprehensive liberalization policy for telecom sector is in the
offing.
PTCL is in full awareness of the same, and future policies feature a
strong conviction of healthy competition.
The company is in process of enhancing organizational and business
proficiency through vertical integration and horizontal diversification.
At the same time, cross-national ownerships, operations and
partnerships are being evaluated with a view to developing and
diversifying the business.
 Historical Background

1947 Posts & Telegraph Dept. established

1962 Pakistan Telegraph & Telephone Deptt.

1990-91 Pakistan Telecom Corporation

ALIS: 850,000
Waiting list : 900,000 Expansion Program of 900,000 lines initiated
(500,000 lines by Private Sector Participation
400,000 lines PTC/GOP own resources).

1995 About 5 % of PTC assets transferred to PTA,FAB & NTC.

1996 PTCL Formed listed on all Stock Exchanges of Pakistan

1998 Mobile & Internet subsidiaries established

2000 Telecom Policy Finalized

2003 Telecom Deregulation Policy Announced

 President & Company Secretary

Name Designation

Mr. Walid Mohamed

Ahmad Suleiman President & CEO
Irshaid

Ms. Farah Qamar Company Secretary

Board of Directors

Mr. Farrakh Qayyum

Chairman PTCL Board

Secretary IT, Ministry of Information Technology
Government of Pakistan
Islamabad

Mr. Abdulrahim Abdulla Mr. Tanwir Ali Agha

Abdulrahim Al Nooryani
Secretary, Ministry of
Executive Vice President Finance
Contracts and Administration Government of Pakistan
 Etisalat, UAE Islamabad

Mr. Abdulaziz Ahmed Saleh Mr. Noor-ud-Din Baqai

Ahmed Al Sawaleh
Member (Telecom)
Chief Human Resource Officer Ministry of Information
Etisalat, UAE Technology
Government of Pakistan
Islamabad

Mr. Ahsanullah Khan

Ambassador
Embassy of Pakistan
Abu Dhabi, UAE

Mr. Fadhil Mohamed Erhama Al

Ansari

General Manager
Networks Services
Etisalat, UAE
Mr. Abdulaziz Hamad Omran Mr.Saood hamad Al
Taryam Junaibi

General Manager
Northern Emirates
Etisalat, UAE

Ms. Farah Qamar

Company Secretary
PTCL Headquarters, G-8/4
Islamabad
Top Management

Mr. Walid Mohamed Ahmad Suleiman Irshaid

(President & Ceo)

Senior Executive Vice Presidents

Mr. Salim Al Akbary Mr. Mashkoor Hussain Mr. Amiruddin

SEVP HR & Admn SEVP Operations SEVP Information Technology

Mr. Akhtar Hanif Aziz

SEVP Special Project

Executive Vice Presidents

 Mr. Zomma Mohiuddin Mr. Muhammad Iqbal Waseem Syed Ali Qadir Gilani
EVP Corporate Strategy EVP Business Development EVP Corporate Communications

Mr. Jamil A.Khwaja Mr. Muhammad Faiz-ur- Mr. Sher Bahadar Khan
EVP Corporate Services Rehman EVP International Business
EVP Accounts Relations
.

Mr. Zubair A. Tonio

EVP Development (South, CH. Shaukat Ali Mr. Shaukat Hayat
Karachi) EVP (ADMN) EVP Development
.

Mr. Nafees Ahmad Siddiqui

EVP Operations (South,
Karachi)
Mr. A.D. Raza Mr. Aftab Ahmed Chishti
EVP Operations(Central, EVP I/Audit
Lahore)
.

Syed Ubaid Hussain Shah Mr. Abdul Qayyum Mr. Fuad Imran Khan
EVP Procurement EVP Quality Assurance EVP Information Technology
 Mr. Pervez Akhtar Mr. Shabbir Hussain Mr. Tariq Qureshi
EVP (T&SP) EVP Consumer Services EVP Commercial Planning &
Support
.

Mr. PERWAIZ Mr. NEHMATULLAH Mr. GUL BAHADAR YOUSAF ZAI

MD TF Islamabad MD PTET Islamabad MD TIP HARIPUR
 Progress Summary of Past Five Years.

PROFIT BEFORE TAXATION:

2001… RS. (m) 32,132

2002… RS. (m) 33,329

2003… RS. (m) 37,588

2004… RS. (m) 44,034

2005… RS. (m) 39,751

2006… RS. (m) 31,310

 PROFIT BEFORE TAXATION.

2005… RS. ( m ) 39,751

2006… RS. ( m ) 31,310

40,000
35,000
30,000

RS.
25,000
(M)
20,000 2005
15,000 2006

10,000
5,000
0
2005 2006

The cause of decline of profit in year 2006 is raise in the

administrative and selling expenses.
PROFIT AFTER TAXATION:

2001… RS. (m) 18,155

2002… RS. (m) 19,812

2003… RS. (m) 23,081

2004… RS. (m) 29,170

2005… RS. (m) 26,606

2006… RS. (m) 20,777

 PROFIT AFTER TAXATION.

2005… RS. ( m ) 26,606

2006… RS. ( m ) 20,777

30000
25000
RS. 20000
(m) 15000 2005
10000 2006
5000
0 2005
2005 2006
Analysis of past and current year performance.

SALES ANALYSIS…

Revenue

80
70
60
2001
RS. 50 2002
(Billions) 40 2003
30 2004
2005
20
2006
10
0
2001 2002 2003 2004 2005 2006
PROFIT ANALYSIS…

Operating and Net Profit

45
40
35
30
RS. 25 Operating
(Billions) profit
20
Net Profit
15
10
5
0
2001 2003 2005
Profitability and Performance Measures.

(G.P)

Gross profit Margin: Gross profit / Sales

2005… % 47.80

2006… % 39.60
 GROSS PROFIT MARGIN.
2005

G.P / SALES = 36,363,724 / 75,972,363

47.80 %
RS. ( B )
2006

27,397,518 / 69,085,436
39.60 %

50
45
40
35
30
25 2005
20 2006
15
10
5
0
2005 2006
The G.P margin is low in year 2006 as compared to year 2005 it is
because of less sale in 2006 and more operating cost / cost of good
sold in year 2006.

Net Profit Margin: Net Profit / Sales

2001… % 29.26

2002… % 29.83

2003… % 34.35

2004… % 39.35

2005… % 35.02

2006… % 30.07
 NET PROFIT MARGIN.

2005

NET INCOME / SALES = 26,605,657 / 75,972,363

35 %
RS. ( B )
2006

20,777,430 / 69,085,436
30 %

35
34
33
32
31 2005
30 2006

29
28
27
2005 2006
Earning Per Share: Total Earning / No. of shares
2001… RS. 3.56

2002… RS. 3.88

2003… RS. 4.53

2004… RS. 5.72

2005… RS. 5.22

2006… RS. 4.07

 Investment Analaysis.

(R.O.A)
RETURN ON ASSETS:

Operating Income / Total Assets

2001… % 23.22

2002… % 24.04

2003… % 28.69

2004… % 38.51

2005… % 36.47

2006… % 27.98
 RETURN ON ASSETS.
2005

OPERATING INCOME / TOTAL ASSETS =

36,363,724 / 1,36,077,997
36.47 %

2006

27,397,518 / 152,240,022
27.98 %

40
35
30
25
20 2005
15 2006
10
5
0
2005 2006
Return on asset is less in year 2006 as compared to year 2005
cause operating income of 2006decline as compared to year 2005.

(R.O.E)
RETURN ON EQUITY:

Net Income – Preffered Dividend / Common Stock Outstanding

2001… % 23.51

2002… % 23.33

2003… % 24.75

2004… % 28.20

2005… % 25.43

2006… % 20.21
A / R TURNOVER / DEBTOR`S TURNOVER:

Net Sales / Avg A/R

Avg reciev. = opening recieveables + closing recieveables /2

2001… Times 3.34

2002… Times 3.73

2003… Times 4.60

2004… Times 4.32

2005… Times 4.90

2006… Times 4.30

INVENTORY TURNOVER:

C.G.S / Avg Inventory.

2005… Times 11.99

2006… Times 12.33

 INVENTORY TURNOVER.

2005

C.G.S / AVG. INVENTORY = 39,608,639 / 3,326,622

11.9 Times

2006

41,687,918 / 3,381,150.5
12.33 Times

12.4
12.3
12.2
12.1
12 2005
11.9 2006

11.8
11.7
11.6
2005 2006
 FINANCIAL ANALAYSIS.

CURRENT RATIO:

Current Assets / Current Liabilities.

2001… Times 1.21

2002… Times 1.72

2003… Times 2.02

2004… Times 2.78

2005… Times 1.90

2006… Times 1.66

 CURRENT RATIO.
200
5

CURRENT ASSETS / CURRENT LIABILITES =

39,462,575 /50,168,177
1.90 Times

200
6

/
20,805,953 30,275,532
1.66 Times

1.9
1.85
1.8
1.75
1.7 2005
1.65 2006

1.6
1.55
1.5
2005 2006
ASSET TEST RATIO / QUICK RATIO :

Quick Assets / Current Liabilities.

Quick Assets = ( Current Assets – Inventory )

2001… Times 1.15

2002… Times 1.61

2003… Times 1.91

2004… Times 2.67

2005… Times 1.74

2006… Times 1.54

DEBT RATIO:

Total Liabilities / Total Assets.

2005… % 26.50

2006… % 30.70
 DEBT RATIO.

2005

TOTAL LIABILITIS / TOTAL ASSETS =

36,063,966 / 136,077,997
26.5 %

2006

46,764,558 / 152,240,022
30.7 %

31
30
29
28
2005
27 2006
26
25
24
2005 2006
 EXPECTED RESULT OF THE PROJECT.

SUMMING UP THE WHOLE ANALYSIS OF THE PTCL

COMPANY WE CONCLUDE THAT PROFIT OF THE COMPANY
DECLINE IN THE YEAR 2006 COMPARTIVELY IN YEAR 2005
AND THE PROFIT MAXMISING IS ONE OF THE BASIC
OBJECTIVES OF COMPANY SO WE HAVE TO WORK EVEN
HARDER TO TAKE THE COMPANY TOWRADS THE NEW
HORIZONS OF PROGRESS.