Expectation: Cement sales to increase 6% in July-Feb

Exports to Afghanistan remain under pressure.

KARACHI: Indicating a modest boost to construction activity, cement sales are expected to grow 6% in the first eight months (Jul-Feb) of fiscal year 2015 (FY15), according to provisional data compiled by Topline Securities on Thursday.

However, cement sales are expected to decline 3% in February to 2.8 million tons compared to 2.9 million tons in January 2015 mainly because of lesser number of days in February. However, when compared to February 2014, cement sales will be higher by 2.6%.

Cement exports to Afghanistan has remained under pressure. However, increase in domestic demand has more than offset the decline in exports.

“We expect exports to Afghanistan to remain on the lower side while aggressive development spending by the government before the end of the year will support growth in local dispatches,” the report added.

According to the report, local dispatches are expected to grow 9.4%.

“Our channel checks in the cement industry suggest that local dispatches in the first eight months of fiscal year 2015 will clock in at 17.8 million tons, up 9.4% compared to 16.3 million tons in the same period of previous year.”

However, exports are likely to remain at 5 million tons, 5.5% lower than 5.3 million tons last year.

“We expect total sales during the eight months to be around 23 million tons, a growth of 6% against dispatches of 21.6 million tons during the same period of last year.”

Published in The Express Tribune, February 27^th, 2015.

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