Who is Sahid? Well, wouldn’t you like to know.
It is also a question that the Securities & Exchange Commission of Pakistan (SECP) would like to know, and also, the CEO of Bela Automotives.
Let us backtrack a little. Bela Automotive was incorporated as a private limited company in November 1983, converted into a public limited company in August 1985, and its shares were quoted on the stock exchange in 1994. Mainly, Bela Automotives produces and markets automotive parts, bicycle parts, bolts, nuts, among other items. It is located at Hub, near Karachi.
Now, on February 14, 2020, the CEO of Bela Automotives, Abdul Mateen Allawala, sent a standard letter to the SECP, asking for the regulator to issue a direction for the holding of the annual general meeting of the company for 2019, on March 25, 2020. This letter was scanned and sent to the Pakistan Stock Exchange, as per regulations.
Clearly, the SECP also received the letter and sent an approval back. So far, so standard. Here is where it gets weird. In a letter dated September 3, 2020, Allawala explains:
“We have come to know that you have already sent us the approval for holding the AGM for the year 2019 and your permission was received by someone named “Sahid”. We are sorry to inform you that neither we have received any such permission, nor we have anyone by the name of “Sahid” in our office.”
Allawala asked for the permission to be sent again, this time to hold the AGM on October 15, hopefully also including two email addresses, just in case the SECP messed up again.
But it also seemed in their effort to be thorough in their explanation, Bela Automotives could not hide their incredulity at the SECP.
“Please also recheck our postal address just to make sure it reaches us this time. This has never happened before. We always receive your mail. We feel that either the address mentioned on the envelope was incorrect, or it reached the wrong place,” read the notice.
In case you are wondering, Bela Automotives is right: the SECP does usually send their mail correctly. For instance, on June 24, 2019, Bela Automotives asked for an AGM for the year 2018. This was duly granted in writing by the SECP on July 1, 2019.
Which obviously begs the question: who is this mysterious Sahid who does not work at Bela Automotives, but seized the SECP letter? Actually, this is a good litmus test: if you, a random citizen, discovered an SECP direction to hold an AGM in your mail, would you A) call the SECP or the company in question to send the notice to the correct address, or B) pull a Sahid, and say you worked at said company, take the mail, and then disappear off the grid just for fun?
Profit posed these questions to Abdul Mateen Allawala, who flatly said he was uninterested in commenting on the matter. But wherever Sahid is, we hope he is happy: because Bela Automotives really needed that AGM to pull through (which has now been delayed to October of this year). The company is not doing well, to say the least.
For one, it is on the Pakistan Stock Exchange’s (PSX) defaulters list. It has consistently made a loss for the last six years: a loss of Rs7.5 million in 2014, Rs8.1 million in 2015, Rs10.8 million in 2016, Rs9.8 million in 2017, Rs10.7 million in 2018, and Rs7.2 million in 2019. No matter the year, the cost of sales far outstrips the actual sales every year.
Bela is, at least in theory, an automobile parts manufacturer. They do not maintain a website. We could not tell you which automobile assemblers they work with, though judging by the fact that they import parts from Taiwan and China, we suspect it is not any of the big three Japanese car assemblers. The company has been have been on the defaulters list of the PSX for several years now. We have found articles in Business Recorder dating back to 2005 describing them as defaulters. And if you could not make money in the Pakistani automobile business in 2005, well, maybe you need to find a new line of work.
The company also suffered when the Income Tax department froze the company’s vendor’s bank accounts in October 2014. The matter was resolved in September 2015, but the damage had already been done. According to Bela’s version of events: “This order of freezing of accounts by the Income Tax was certainly illegal as it had added entries of 14 years old. The same order was also illegal as he denied the company depreciation. The entire order was illegal and it took us about one year to have the illegal add backs and depreciation to be allowed. During this period, besides monetary loss, it was a loss of goodwill of our company and we lost our customers.”
Then, Bela Automotives pointed out that the various audits by the government departments, meant that the accounts of the company remain to be finalized. And finally, the company is still stuck on an ongoing settlement with HBL finance accountants, which has been ongoing since at least last year, and has still to be resolved.
So all in all, these are not the best of times for Bela Automotives. And on top of everything the company is struggling with, it now has to deal with some Sahid running off with their mail.