KARACHI: Engro Polymer & Chemicals Limited - the only company in Pakistan that produces poly-vinyl-chloride (PVC) - has announced a net income of Rs200 million in the quarter ended on June 30, 2017, up 809% compared with Rs22 million in the same period of last year.
Earnings per share (EPS) jumped to Rs0.30 from an EPS of Rs0.03 in the period under review, according to a company notice sent to the Pakistan Stock Exchange (PSX).
The KSE-100 Index closed on Monday at 46,465, down 441 points or 0.88% while Engro Polymer share closed at Rs34.88, down 2%.
The six month (January to June 2017) net income of the company rose even higher to Rs1.05 billion, up 2,525% compared with Rs40 million in the same period of last year.
Corporate Results: Engro Corp’s 2016 profit soars to Rs73.59b
Engro Polymer, a subsidiary of Engro Corporation that is one of the largest private-sector conglomerates in the country, had announced to inject $9 million into expanding its plant capacity in December 2016.
The new investment will increase the annual production capacity to 195,000 tons, up 14.7% from its current capacity of 170,000 tons. The project is expected to be completed by December 2017.
With 170,000 tons of installed capacity, the company meets 80% of the PVC demand in the country, while the rest is met through imports. In the imported material, 10-12% comprises hazardous scrap of PVC.
Company officials say energy shortages and load-shedding were some of the biggest impediments to the growth of PVC industry in Pakistan.
The company’s history dates back to 1994 when it was established as a joint venture with two Japanese companies. Later, perturbed with low margins, it decided to change the business model by producing PVC raw material in Pakistan and made an investment of $350 million.
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Pakistan’s per capita PVC consumption is lower than regional standards. It stands at just 0.6-0.7 kg compared to 100% higher consumption in India and 16-17 kg in developed nations.
PVC is mainly used in manufacturing PVC pipes. Other sectors include artificial leather, shoes, rigid and soft sheets, garden hose, windows and doors, etc.
Published in The Express Tribune, August 8th, 2017.
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