Cement companies have invested in expanding operations in anticipation of burgeoning demand owing to construction activity under the China-Pakistan Economic Corridor and the growth in housing projects.
And the steel industry is catching up fast with the expected rise in demand.
As per international standards, every five tonnes of cement used in infrastructure projects require one tonne of steel. Around ten steel mills are listed on the Pakistan Stock Exchange (PSX), most of them having entered into the capital market between 2011 and 2017.
This represents the highest number of new listings during the six-year period in any one sector. The latest player seeking its way into the PSX is Iteefaq Iron Industries Limited. The company manufactures Re-bars and has the capacity to produce 120,000 tonnes per year, which is about 2pc share of the local market.
Steel companies expect to gain supply contracts related to the upcoming infrastructure projects under the CPEC umbrella. These include Orange Line, Karachi-Lahore Motorway and Neelum-Jehlum hydropower project among others.
Steel sector watchers say that the country’s steel demand is expected to rise at a 3-year (FY17-19) combined annual growth rate (CAGR) of 15pc compared to the last 3-year’s CAGR of 14pc.
“Considering that currently around 45pc of the country’s steel requirement is met through imports, local steel players have significant room for organic growth”, says a sector watcher.
Cliick The link For More news : http://www.par.com.pk/news
Comments
Post a Comment