Karachi: According to All Pakistan Cement Manufacturing Association (APCMA), cement off takes have surged by 3.31%YoY to 26.643 mn tons during 10MFY12 as against 25.79 mn in the corresponding period.
According to Alfalah Securities Limited, out of the total, local cement offtakes during the 10MFY12 period stood at 19.629 mn tons as compared with 18.09 mn in the same period last year, witnessing a significant growth of 8.51%YoY mainly due to revived construction activities across the country in the current financial year and disbursement of PkR 274 bn against an allocated target of PkR 300 bn in the Public Sector Development Programme (PSDP). On the other hand, export sales dropped by 8.91%YoY to 7.015 mn tons during the 10MFY12 period as compared with 6.44 mn tons in the same period last year. Alfalah Securities Limited believes the local offtakes would continue to pick up at a steady pace mainly due the election year coming up where the government may allocate additional development funds to gain popularity among the masses, and the manufacturers would also like to reap the benefits of higher cement prices, which are currently hovering at PkR 425/bag despite a slowdown in international coal prices. Moreover, Alfalah Securities Limited also believes that the local cement industry would benefit from increased exports to India in the upcoming time due to opening of trade route through Wagha border therefore; Alfalah Securities Limited stays optimistic in cement sector stocks in the long term.