⚡ Flash Summary

Askari General Insurance Company Limited (AGIC) is offering 28,760,758 new ordinary shares via a rights issue to existing shareholders, representing approximately 40% of the current paid-up capital. The rights issue price is PKR 32 per share, which includes a premium of PKR 22 over the face value of PKR 10. The total amount to be raised is PKR 920,344,256, intended to strengthen the company’s capital base, enhance working capital, and ensure compliance with regulatory capital requirements. This move aims to boost the investment portfolio for higher income, secure better reinsurance terms, and improve underwriting capacity and risk retention.

📌 Key Takeaways

• 📢 AGIC is issuing 28,760,758 right shares.
• 💰 The issue represents ~40% of existing paid-up capital.
• 🏷️ Each share has a face value of PKR 10.
• 💸 The offer price is PKR 32 per share (including PKR 22 premium).
• 🎯 The total funds raised through rights issue: PKR 920,344,256.
• 📈 The company aims to strengthen its capital base and working capital.
• ✅ Regulatory compliance is a key driver for the issue.
• 💼 The funds will augment the investment portfolio for higher income.
• 🤝 The company seeks better reinsurance terms and increased underwriting capacity.
• 🛡️ Risk retention levels are expected to improve.
• 🏢 Askari Bank Limited is appointed as the Banker to the Issue.
• 📅 Tentative schedule for the Letter of Rights issuance is provided.
• 📑 The offer document contains details of underwriters: Arif Habib Limited and Dawood Equities Limited each underwrites PKR 184,033,440.
• 🤝 Army Welfare Trust (AWT) holds 59.25% shares in Askari General Insurance Company Ltd and is committed to subscribe.
• ⚖️ The company faces outstanding legal proceedings disclosed in the financial statements.

🎯 Investment Thesis

A “HOLD” recommendation is appropriate for AGIC. The rights issue should strengthen the company’s financial position and support future growth. However, the insurance sector faces inherent risks, and the ongoing legal proceedings add uncertainty. Existing shareholders should consider participating in the rights issue to avoid dilution, but new investors should remain cautious until the benefits of the capital injection are realized and the legal issues are resolved.