ARSHAD HUSSAIN
Lucky Cement (LUCK), Pakistan’s largest cement manufacturer, has decided to set up an associated company to assume manufacturing, assembling, marketing, distribution, sale, after-sales service, import and export of all types of Kia Motor Corporation in Pakistan.
In this connection, the Lucky Cement has allocated a proposed equity investment of up to Rs 12 billion, divided into 1,200 million shares (Rs 10 per share). The company has finalized its all paperwork, a notice of LUCK at PSX said here on Thursday.
The analyst at Topline brokerage house said, “There is a strong potential for automobile growth due to higher disposable income and low interest rates environment and it hands-on expertise to manage diversified businesses, provide a lucrative opportunity to the company to exploit growing local automobile industry.”
He said that Pakistan’s car penetration was 13 vehicles per thousand persons (significantly lower than the regional average of 162).
Meanwhile a source in Engineering Development Board (EDB) said that only Shehzore Company has so far submitted plan for reviving its vehicle manufacturing with local assemblers, while there were all rumours regarding the new car manufacturing companies. The source said that Hundai Shehzore was negotiating with Dewan Farooq group for its revival and would likely to see the re-launch of Shehzore 1-Ton single rear wheel truck and Shehzore 1-Ton truck.
It is also learnt that two foreign car manufacturing companies, Renault and Audi have also submitted their plans to Board of Investment (BoI). The representative of Audi in Karachi said, “Our plan has been handed over to BoI for the final approval and after it we will get final approval from the EDB.”
The Audi had purchased land in Korangi, near one of Pakistan’s biggest industrial estates and planning to invest over $30 million in Pakistan, a statement of BoI said.
Audi AG is represented in different countries through either authorized importers or assembly/manufacturing plants – the latter investments coming after the country has shown enough appetite for the luxury brand. Pakistan is one of 57 countries where Audi AG is represented by an authorized importer
Recently in September this year, Dewan Farooq Motors, which was the manufacturer of famous Shehzore truck, has announced plans to restart vehicles’ production of different segments by end of October 2016.
“Renault has decided to invest in Pakistan. They will start assembling cars in Pakistan by 2018,” the BoI said in a statement, claiming the development was the outcome of the “hectic efforts and persuasion” by Finance Minister Ishaq Dar. The company will invest $100 million to expand the capacity of Ghandara Nissan plant where it will assemble the vehicles”
In recent years, automobile demand in Pakistan has increased while new entrants like Volkswagen, Europe’s largest auto maker, is also contemplating to introduce one of its car brands in Pakistan soon.
