AVN 65.45 Increased By ▲ 0.50 (0.77%)
BAFL 30.65 Decreased By ▼ -0.86 (-2.73%)
BOP 4.83 Increased By ▲ 0.04 (0.84%)
CNERGY 3.72 Decreased By ▼ -0.12 (-3.13%)
DFML 14.26 Decreased By ▼ -0.15 (-1.04%)
DGKC 41.06 Decreased By ▼ -0.54 (-1.3%)
EPCL 46.56 Decreased By ▼ -0.14 (-0.3%)
FCCL 11.35 Increased By ▲ 0.06 (0.53%)
FFL 5.03 Decreased By ▼ -0.02 (-0.4%)
FLYNG 5.78 Decreased By ▼ -0.04 (-0.69%)
GGL 10.28 Decreased By ▼ -0.17 (-1.63%)
HUBC 67.03 Increased By ▲ 1.39 (2.12%)
HUMNL 5.68 Increased By ▲ 0.02 (0.35%)
KAPCO 27.85 Increased By ▲ 0.10 (0.36%)
KEL 2.19 Increased By ▲ 0.04 (1.86%)
LOTCHEM 24.83 Increased By ▲ 0.48 (1.97%)
MLCF 21.37 Decreased By ▼ -0.11 (-0.51%)
NETSOL 84.20 Decreased By ▼ -0.59 (-0.7%)
OGDC 85.94 Decreased By ▼ -1.31 (-1.5%)
PAEL 11.01 Increased By ▲ 0.03 (0.27%)
PIBTL 4.17 Decreased By ▼ -0.05 (-1.18%)
PPL 74.56 Decreased By ▼ -1.14 (-1.51%)
PRL 13.40 Decreased By ▼ -0.25 (-1.83%)
SILK 0.92 Increased By ▲ 0.03 (3.37%)
SNGP 40.44 Decreased By ▼ -0.89 (-2.15%)
TELE 5.86 Increased By ▲ 0.01 (0.17%)
TPLP 15.42 Decreased By ▼ -0.22 (-1.41%)
TRG 111.63 Decreased By ▼ -0.07 (-0.06%)
UNITY 13.76 Decreased By ▼ -0.22 (-1.57%)
WTL 1.14 Decreased By ▼ -0.02 (-1.72%)
BR100 4,037 Decreased By -26.9 (-0.66%)
BR30 14,412 Decreased By -56.6 (-0.39%)
KSE100 40,471 Decreased By -262.4 (-0.64%)
KSE30 15,163 Decreased By -67.2 (-0.44%)
Follow us

While the country’s top cigarette manufacturers have posted strong bottom lines lately, the cigarette production, as captured by official data, has shown single-digit growth in the first half of CY21. As per the latest data from the Pakistan Bureau of Statistics, the formal sector’s cigarette output totaled 26.4 billion sticks between January and June 2021, a growth of 9 percent compared to the same period last year.

Average cigarette production came in at 4.4 billion sticks in 1HCY21, which is higher than last year but still lower than the 5 billion peak seen in 2018 and 2019. Monthly production touched 5.4 billion sticks in March, but it has come down in later months. For instance, in June, the month of budget announcement, some 2.7 billion sticks were produced, the lowest monthly production level since June 2019.

The top two producers have done well in 1HCY21. Pakistan Tobacco, the market leader, saw net turnover jump 18 percent year-on-year to Rs37 billion, with net profit surging 24 percent to Rs9 billion. Philip Morris, the second-ranked player, increased its bottomline by 37 percent year-on-year to Rs1.7 billion, as savings in manufacturing costs and administrative overheads amplified the 5 percent gain in net turnover, which reached Rs9.2 billion in the first half of this year.

At the current pace, the documented tobacco sector will produce some 53 billion cigarette sticks in the entire CY21. The sector has previously demonstrated an actual manufacturing capacity to produce at least 60 billion sticks per annum. However, there are constant complaints from leading tobacco players that they are not getting an even playing field due to some tobacco companies evading duties and taxes.

As per Pakistan Tobacco, duty-non-paid cigarettes had market share of 37.6 percent as of May 2021. Philip Morris Pakistan recently estimated that illicit cigarettes had 40 percent market share. Illicit brands are said to be considerably low-priced compared to taxed and duty-paid brands. The latest budget was neutral for the formal tobacco sector, as there was no change in FED rates or in the FED structure. While this is expected to support formal sector a bit, there is no way around cracking down against illegal sales.

Comments

Comments are closed.

On cigarette production

Imran talks of ‘jail bharo’ movement soon

Pakistan to appeal to Taliban leader over mosque bombing

Section 144 imposed in Peshawar

Marriyum steps up criticism of IK

IK says ‘some other people’ behind acts of vengeance

Foreign authorities seeking properties/bank accounts info: FBR won’t intimate concerned taxpayer about request

Dar chairs meeting on role of PDFL, SOEs

‘Kashmir Solidarity Day’ today

WB board to consider $78m ‘digital economy’ project next month

PM directs PD to recover Rs1.13bn royalty amount from 2 oil, gas cos