Karachi: BMA Capital Management Limited, Pakistan’s premier financial services group hosted a corporate briefing of Attock Cement Company Ltd (ACPL) on Thursday 15th May 2014. Mr. Irfan Amanullah, CFO Attock Cement Company Limited, briefed about the growth prospects and competitive dynamics of the cement industry and also discussed the future plans of his company.

Mr. Amanullah highlighted that unlike other developing economies, cement demand in Pakistan has not been growing due to absence of government’s investment in any major public development projects. However, he expects this trend to change in the near future on the back of increasing foreign flows and better economic management by the government. “Pakistan is faced with a shortfall of 3.0-3.5mn housing units and ~300K is added to this stock every year. In addition, there is a huge infrastructure gap – road networks, dams, bridges – that needs to be filled. If the government is able to increase its revenues, it will be able to route the surplus in to development programs in housing and infrastructure,” he added.

Mr Amanullah expects exports to Afghanistan to decline but was optimistic about demand in the Middle East and Africa. “Capacity expansions in the Middle East and India would be absorbed due to increasing demand from Africa and Sri Lanka,” he added.

He emphasized the importance of price discipline in both domestic and export markets for long term sustainability of the industry. “However, price increases are no longer the margin driver for the industry. Key driver is going to be reduction in production costs,” he further said.

Mr Amanullah touched upon the potential earnings impact from Attock Cement’s 3000 tons per day grinding mill in Basra, Iraq and also discussed various measures that the company is taking to improve its production efficiencies.