Lucky Cement, the top cement manufacturing company in Pakistan posted its third quarter results for the financial year 2017. The 9MFY17 earnings of the company clocked in at 32.23, up 8 percent compared the previous year.
Net sales of the company grew by 5 percent because of robust local demand. However, exports declined by 24 percent. During the reported quarter, the company also witnessed decline in margins due to increase in international coal prices, which went up by almost 30 percent during the last few months. On the other hand, a 10MW waste heat recovery unit came online at the Pezu plant, which cushioned the impact of coal prices.
The company also updated its investors on various ongoing projects. The brownfield expansion of 1.25 million tons per day of cement at Karachi plant is underway and is expected to complete by this year. On the other hand, Lucky is still awaiting approval from government of Punjab regarding its expansion in the province. Lucky wants to setup 2.3 million tons per day cement plan there.
The company has also applied to the Board of Investment to start a car manufacturing plant in technical collaboration with Kia Motors Corporation of South Korea. The company is expecting approval by the end of April.
After the announcement of the result, the stock of the company reacted positively and shot up to 903 rupees, but closed the day around 892 rupees, as some investors booked profit. The stock has outperformed the benchmark KSE-100 index with a return of over 50 percent during the last on year.
Looking forward, the prospects for Lucky Cement look bright as ever. The company is in the sweet spot to take advantage of infrastructure development projects across the country. The diversified portfolio of the company also gives it a foothold in many other industries through companies ICI.
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