The Lucky Cement has planned to set up units in foreign markets to increase its export particularly to Sri Lanka, besides minimizing the cost.
According to the sources the company has also made an agreement with HESCO, to supply 20MW of electricity, which could be improved to 49MW, enabling the company to earn a revenue of Rs608 million. The company would also be a major beneficiary of the FIFA World Cup in Qatar to take place in 2022 with cement demand to augment after 2012 till 2019.
The latest data reveals, the company’s local sale will increase by 75 percent in FY11 on the basis of its performance in southern zone. It is expected the total capacity would increase to 71.5 percent in FY11 from 61 percent reported last year with total installed capacity of the industry being 44 million tons and operational capacity of 39 million tons approximately.
The company’s cost reduction would continue to take place as it is also in the course of building Refused Derived Fuel (RDF) plant, which will replace around 40 percent of the coal used in the Karachi plant with wood, used tires and rice husk etc, and will incur only minor maintenance cost, the management believes.
Furthermore, it would leave LUCK with surplus capacity of about 75 MW to 80MW which would give it room for additional expansions or revenue generation by selling it . LUCK is also attractive given the fact that it is one of the premier dividend payers in the cement industry.
