public company, Hascol was incorporated in 2001 and the company got its oil and marketing license in 2005. In 2007, it became an unlisted public company which means that although it was a public company its shares were not floated in the market however it became a listed company in 2014 on the Karachi Stock Exchange.
In 2009, they hired Mr Saleem Butt as chief operating officer, and he is a very important person because later on he also became the Chief Executive officer. Mumtaz Aslam Khan is also an important leading character in the unique scam in Pakistan however he was been arrested as he was the founding Chairman of Hascol. The investigation reveals that Saleem Butt was the person who was running the entire company and especially Hascol`s relationship with the banks was being managed by Saleem Butt.
After Saleem Butt joined Hascol in 2009, this company has grown exponentially for example, since 2010-2018, the company revenues have grown 52.7 % per year on average and this growth was actually one of the main reasons which caused a huge problem for Hascol. In an investigation, the members of Hascol company told many reasons for its unsustainable growth some say that the company was giving out heavy discounts and growing aggressively which couldn’t be justified.
public company. They were opening pump after pump, but they didn’t have enough money because of which they borrowed a lot of money from the banks. In 2018, it became Pakistan`s second largest marketing company behind PSO with a worth of 234 billion rupees turnover thus in 2019, their revenue fell because they had reduced institutional sales and somewhat they slowed down their aggressive growth due to liquidity issues.
public company, There were losses overall in the oil sector but their losses were more in comparison and when some generalists asked form Mumtaz Hasan Khan and other officials about it, they gave two reasons for it. The first reason they gave was that they said when the prices of oil fell in the international Market from $70-75 dollars to $50-55 the government of Pakistan at that time lowered the oil prices and they had old oil reserves which they bought earlier therefore they suffered a huge loss on it.
On the other hand, the thing to understand is that Hascol imports a major quantity of its oil but other OMCS also import oil and if you look at their ratio of imported oil versus oil they buy from local refineries the Hascol`s ratio was quite high.
public company, The FIA investigation said that there was a contract between Hascol and Vitol under which Hascol was bound to buy more than 80% of its oil from there while the management of Hascol said that Pakistan`s oil company is not willing to provide oil to them. Hascol had overvalued its assets and overestimated its profits as well in addition to that they were showing fewer expenditures. because of this the size of the balance sheet had increased and based on that inflated balance sheet they were able to get more lending facilities from the bank.
FIA investigation, The entire 56 billion rupees neither belonged to Hascol employees nor the amount in their founder or CEO bank accounts, these were the losses that the company made Bank didn’t become the reason for Hascol’s decline rather this company had to pay back huge amounts of loans to the banks and in the current period of time Hascol company is not in a position to pay back the loans and following the time period Hascol wouldn’t be able to pay back.