Several Cement Companies Are Expanding Thanks to Govt Policies

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Half a dozen cement companies have announced expansion plans in the past few months. This boost to the cement sector is said to have come from the Prime Minister’s focus on the construction sector in a bid to boost the economy, reported Bloomberg.

A year after Prime Minister’s incentives for the construction sector, Lucky Cement Ltd., Bestway Cement Ltd., and D.G. Khan Cement Co. and many other firms have announced plans to increase production capacity by 31 percent, Bloomberg reported.


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This will translate into a total capacity of 91 million tons when the expansion plans are completed, Insight Securities Pvt. Limited data showed.

The incumbent government announced last year that it would subsidize low-cost housing. An amnesty scheme of sorts was also introduced whereby investors in construction projects are not to be asked for the source of their funds.

The banking sector was also directed to increase their outstanding mortgages by at least 5 percent by December.

Resultantly, cement stocks outpaced the nation’s benchmark index. A group of 19 cement manufacturers has seen their shares rise 67 percent in the past year, compared with the KSE-100 Index’s 30 percent gain.

Moreover, nearly 1,000 projects have registered under the government initiative, with the boom just about to start on the ground.

The news report quoted Waleed Saigol, Director at Maple Leaf Cement Factory Ltd., saying, “Construction-related activities have a very, very big multiplier effect in emerging economies.”

He said, “The government has realized that the private sector has to play a leading role in getting the wheels turning again.”


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The boost in the construction sector is also having impacts on other segments, such as consumer home finance. Pakistan’s home financing is one of the lowest in South Asia, but by May 2021, it had jumped by 18 percent to a record 97.8 billion rupees.

Pakistan is also on its way to realizing its first real estate investment trust in over six years.

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