Tuesday, February 5, 2013

Pakistani Construction Boom Continues in 2013

Domestic cement consumption surged 10.10% in Pakistan in January 2013, according to All Pakistan Cement Manufacturers Association. On top of 8% increase in Fiscal Year 2011-12, it jumped another 8% for the first seven months of Fiscal Year 2012-13.

Cement production is an important barometer of national economic activity,  according to a research report compiled by a Credit Suisse analyst.  Last year, CS analyst Farhan Rizvi said in his report that "higher PSDP (Public Sector Development Program) spending has led to a resurgence in domestic cement demand in FY12 (+8%) and with increased PSDP allocation for FY13 (+19%) and General Elections due in 2013, domestic demand is likely to remain robust over the next six-nine months".

Ongoing public sector projects include new large and small dams, irrigation canals, power plants, highways, rapid transit systems, flyovers, airports, seaports, etc. Most of these were already in the pipeline when the PPP government assumed control in 2008. Recent pre-election increases in PSDP funding allowed work to resume on these projects in 2011-12.

 In addition to public sector infrastructure projects, there is a lot of privately funded real estate development activity visible in all major cities of the country.

Ocean Tower Karachi
Among the high-profile new construction projects completed this month is Ocean Tower in Karachi. At 393 feet high with 30 floors, it is now the tallest building in Pakistan. Ocean Tower has a shopping mall, food courts, corporate offices, a business club, car-parking area and 4 cinemas.

The Centaurus Islamabad
The Centaurus, at 361 feet, is another new project in Islamabad completed this month. It consists of three towers---office tower, residential tower and a 5-star hotel. The three will be linked by a shopping mall.

Big real estate developers like Bahria Town and Habib Construction are developing both commercial and housing projects in Islamabad, Karachi and Lahore. Other cities like Faisalabad, Hyderabad, Larkana, Multan, Mirpur, Peshawar and Quetta are also seeing new housing communities, golf courses, hotels, office complexes, restaurants, shopping malls, etc.

Per capita cement consumption in Pakistan was only 70 Kg in 2003. It has more than doubled in the last decade.  With back-to-back increases in domestic cement demand, per capita consumption has now risen to 154 Kg which is still below average for Asia. But the rising demand is a good sign of economic recovery since 2009 when the GDP growth hit a low of 1.7%.

Centaurus Mall Opening Day


Credit Suisse is bullish on Pakistan's cement sector in particular and Pakistani shares in general.

CS analyst Farhan Rizvi has initiated coverage with "an OVERWEIGHT stance, as we believe compelling valuations, improving domestic demand outlook, better pricing power and easing cost pressures make the sector an attractive investment proposition. Despite better growth prospects (3-year CAGR of 17% over FY12-15E) and improving margins, the sector trades at an attractive FY13E EV/EBITDA of 3.8x, 49% discount to the historical average multiple of 7.4x. Moreover, FY13E EV/tonne of US$74 is approximately 29% discount to historical average EV/tonne of US$104 and 50% discount to the region".

A New Housing Construction Project in Rawalpindi


Another CS analyst Farrukh Khan, based in Credit Suisse’ Asia Pacific headquarters in Singapore,says in his research report that “liquidity in 2012 has been concentrated in stocks offering positive earnings surprises (e.g., United Bank, Lucky Cement, DG Khan Cement and Bank Alfalah), enabling them to be strong outperformers. With further improvements in liquidity, we expect a broad-based price discovery to take hold in attractively valued oil and fertilizer stocks as well.”

 A string of strong earnings announcements by Karachi Stock Exchange listed companies and the Central Bank's 1.5% rate cut have already helped Karachi's KSE-100 index surge nearly 50% (37% in US $ terms) in 2012 to top all Asian market indices. It was followed by Bangkok's SET index which advanced 36%. It also easily beat India's Sensex index which was the top performer among BRICs with 25.19% annual gain.

Related Links:

 Haq's Musings

Pakistan's GDP Grossly Underestimated, Shares Highly Undervalued

Investment Analysts Bullish on Pakistan

Precise Estimates of Pakistan's Informal Economy

Comparing Pakistan and Bangladesh in 2012

Pak Consumer Boom  Fuels Underground Economy

Rural Consumption Boom in Pakistan

Pakistan's Tax Evasion Fosters Aid Dependence

Poll Finds Pakistanis Happier Than Neighbors

Pakistan's Rural Economy Booming

Pakistan Car Sales Up 61%

Resilient Pakistan Defies Doomsayers

Land For Landless Women in Pakistan

Pakistan's Circular Debt and Load-shedding

39 comments:

Hopewins said...

Similar article w.r.t. Indonesia:
http://alturl.com/taarq

rafi said...

Is the same in my village, many construction of new houses and villas, with nice havallis - new motor cycles, cars, flat screen tv's, was recently in Gujar Khan meeting former comrades, was surprised at the new restaurants and plazas being constructed, also according to our analyses - about half of GDP is undocumented.

Riaz Haq said...

Karachi is now following the example of Lahore to build a mass transit system...a combiatiion of trains (Karachi Circular Railway or KCR) and buses (Bus Rapid Transit or BRT). Here's an ET report:

KARACHI: Progress on the much-awaited Bus Rapid Transport System project is expected to move a step further, when the government awards consultancy rights to a consortium of companies led by the global auditing firm KPMG, officials told The Express Tribune on Monday.

KPMG has been hired as the financial adviser for the project, with the National Engineering Services Pakistan (Nespak) and Mohsin Tayebaly and Company responsible for technical and legal affairs, respectively.

While the formal agreement is expected to be signed in a few days, it would take another 13 months before construction kicks off on the first part of the project, the 22-kilometre-long Yellow Line, which would connect Dawood Chowrangi in Landhi to Numaish in Saddar. Nespak is already undertaking the BRTS project in Lahore, which is near completion.

“Now we would decide what needs to be done with the route. For example, deciding whether there is a need for [creating] an overhead passage at any point,” said an official. “A feasibility study needs to be carried out before we can finalise costing and other financial details. Finally, we will look for an investor.” The Karachi Metropolitan Corporation (KMC) had earlier put the expected cost of the Yellow Line at around Rs2 billion, and set 2014 as its launch year.

The transit system involves dedicated buses lanes, which would crisscross roads and bridges. Around 13,000 passengers are expected to use the system in Karachi every hour, which would cut current travelling time by almost half. Buses will run on reserved tracks, at an average speed of 25 kilometres per hour (kmph), well above the average vehicular speed in the city of 17 kmph....


http://tribune.com.pk/story/502645/firm-that-built-lahores-rapid-transit-to-act-as-consultant-for-karachi/

Here's a BR report on KCR:

The ECC which met here under the chairmanship of Minister for Finance and Economic Affairs Dr. Abdul Hafeez Shaikh was informed that Japan International Cooperation Agency (JICA) has already agreed to provide 93.5pc ($2.4 billion) of the estimated cost through soft loan at a markup of 0.2pc payable in 40 years including 10 years grace period. The remaining 6.5pc ($169.6 million) will be borne by the Ministry of Railway (60pc equity), Government of Sindh (25pc equity) and the City District Government Karachi (15pc equity); the stakeholders of KUTC as per their share.

The track of the KCR will be 86 km long with 27 stations to be built around the city.

This important project will be a milestone in improving the quality of life of the citizens....



http://www.brecorder.com/top-news/1-front-top-news/98665-ecc-approves-revival-of-karachi-circular-railways-.html

Riaz Haq said...

Here's more from ET on Lahore Metrobus:

A total of 45 buses have been imported from Turkey which will be driven by Turkish drivers on a single track in Lahore. The buses will stop at 27 stations that cover the entire Lahore. First station is at Gaju Mata and the last one is at Shaadra.

A one-of-a-kind nine kilometer long flyover has been constructed solely for the metro bus. It connects one end of Lahore with the other. Buses will commute on this flyover. The modern system of electronic ticketing has been introduced at all the stations; waterproof escalators have been installed for the elderly, and a squad for security and maintenance has been appointed.

The stations and the entire route of this larger-than-life metro system are up to international standards. Commuting in Lahore will now become as easy as commuting in London city or Bangkok. The only difference is we will have buses instead of trains and they will be manual instead of electronic.

The inauguration of this mega project is today.

After being postponed a couple of times, Shahbaz Sharif has finally given the confirmed date. For the initial four weeks, the buses will be free for all the commuters. However, the fare is extremely cheap. From what I’ve heard, the cost of a ticket from the first to the last station will be as low as Rs45!

Until now, every feature of this yet-to-function project seems to be perfect, but will it be successful?

Will the squad for maintaining cleanliness and security live up to the expectations?

Will all the 45 buses work efficiently for a long period of time?

Most importantly, how will the masses react to this state-of-the-art system?



http://blogs.tribune.com.pk/story/16022/lahore-metro-bus-system-a-major-step-in-pakistans-public-transport/

Hopewins said...

^^RH: Here's Daily Times on 10% increase in overseas remittances in first 7 months of FY2012-13:
----

January 2013 was NOT a good month.

Remittances for Jan 2013 (1,089 Mln$) were LOWER than Dec 2012 (1,134 Mln$) and also LOWER than Jan 2012 (1,110 Mln$).

Here are the data:
http://www.sbp.org.pk/ecodata/Homeremit.pdf

In addition, FY 12 total remittances were 13,186 Mln$.
http://www.sbp.org.pk/ecodata/Homeremit_arch.xls

Annualizing the 7-month figure of 8,206 gives us 14,068 total (projected) for FY 13. So the annualized increase is expected to be around 6%-- IF THE DOWNWARD TREND seen in Jan 2013 does NOT PERSIST....

Riaz Haq said...

Here's Emirates 24-7 report on a massive property investment deal between Abu Dhabi Group and Malik Riaz:

UAE’s Abu Dhabi Group and Pakistani real estate tycoon Malik Riaz on Friday signed a deal to invest $45 billion (Dh165.15 billion) in Pakistan including building the world’s tallest building in Karachi.

Pakistan’s news channel Geo reported today that $35 billion (Dh165.15 billion) will be pumped in Sindh province while the rest will be invested in Lahore and Islamabad.

Under the deal, Sports City, International City, Media City, Educational and Medical City will be built in Pakistan’s financial capital. The news channel said that world’s Seven Wonders will also be built as part of the project.

The deal is expected to generate over 2.5 million jobs in Pakistan.

The channel, however, didn’t reveal the time for the completion of the project.


http://www.emirates247.com/business/economy-finance/abu-dhabi-group-property-tycoon-to-build-world-s-tallest-building-in-pakistan-2013-02-15-1.495174

Riaz Haq said...

Here's an ET report on soaring profits at Nestle Pakistan:

Profits at Nestle Pakistan shot up in 2012 as the company saw its margins increase for the first time in four years, as more and more consumers from Pakistan’s rising middle class are able to afford some of its higher-margin products.

On Monday, the company announced its financial results for the year ending December 31, 2012 – and it was a remarkably positive report: net revenues were up 22% for the year to Rs79 billion, and profits up an even higher 25.6% to Rs5.9 billion compared to the same period in the previous year.

The strong revenue growth for Nestle is particularly remarkable, considering the fact that it is the largest food and consumer goods company in the country, and yet still shows little sign of a slowdown in growth. Indeed, much of that growth appears to be volumetric, showing that consumers have a higher demand for Nestle’s products rather than revenue increases simply being a function of inflation.

But perhaps most encouraging for the company was its increase in gross profit margins, which rose from 25.8% in 2011 to 27.2% in 2012, suggesting that the company is selling more of its higher-margin products. At least some of that higher margin, however, was eroded by higher logistics and distribution costs.

Part of the reason for those higher costs is the installation of more refrigerators as more of its chilled products get sold (mostly yogurt). But another part of it may be that the company is expanding its distribution network into areas where transportation infrastructure is poor and cost of getting products to customers is higher, driving up its overall average.

Nonetheless, Nestle’s size in Pakistan – though miniscule by global standards – appears to insulate it from the kinds of risks that some of its smaller competitors face. Engro Foods, for instance, has somewhat higher distribution costs as a percentage of revenues than Nestle.

Nestle Pakistan’s Swiss parent is the world’s largest food company, with a wide array of products: from those that are commodity-like, to higher-margin products like health foods and chocolates. In Pakistan, however, Nestle has, until recently, been primarily a dairy company. Indeed, until the early 2000s, Nestle’s presence in the country was incorporated as Nestle Milkpak Ltd, named after its signature product. It remains the largest player in the dairy market, collecting milk from an estimated 190,000 farmers spread over 145,000 square kilometres in Punjab and Sindh.

Over the past few years, the company has expanded its product portfolio in Pakistan to include fruit juices, breakfast cereals, instant noodles and confectionaries. But it is still a small proportion of its global portfolio.

Nestle’s ability to rapidly grow its revenues and profits despite being the biggest player in Pakistan appears to be indicative of the tremendous room for growth in the Pakistani market. Consumer spending is expanding as the country’s middle class grows on the back of rapid urbanisation, and increasing household incomes as more and more young people enter the workforce.

Even the advent of a strong local rival in the form of Engro Foods does not appear to have dented Nestle’s growth prospects. In earlier conversations with The Express Tribune, officials at both Nestle and Engro Foods are keen to downplay any talk of a rivalry between the two companies, insisting that there is plenty of room for both to grow. Considering the blowout growth at both firms, there appears to be considerable merit to their argument.

The global giant is currently on track to invest upwards of CHF320 million ($347 million) in expanding its production capacity within Pakistan as part of a three-year plan.


http://tribune.com.pk/story/509211/corporate-results-profits-soar-at-nestle-pakistan-as-margins-rise-again/

Riaz Haq said...

Here's Khaleej Times on incentives in Pak foreign investment policy:

Pakistan has offered major financial and tax-free business incentives and infrastructure facilities to foreign investors as a big Saudi steel mills goes on stream.

These incentives were offered at the highest level by Prime Minister Raja Pervez Ashraf. The prime minister’s came on the occasion of the inauguration of production at the just-built state-of-the-art Tuwairqi Steel Mills Limited (TSML), built by Al Tuwairqi Group of Industries of Saudi Arabia, and South Korea’s Pohang Iron and Steel Company (Posco). Al Tuwairqi Group has invested $350 million and Posco $16 million in the project. This first phase of TSML has been completed at a cost of $366 million. It will produce 1.28 millions tonnes of steel annually. It is the first steel mill in Pakistan built by the private sector.

The inauguration ceremony was highlighted by the prime minister’s unveiling of the pro-FDI incentives plan. Prime Minister Ashraf invited foreign and local investors to come up with industrial projects to be located at Pakistan’s Export Processing Zones (EPZs).

Pakistani EPZs have all modern infrastructure. “I urge foreign investors from across the globe to invest in Pakistan. I assure you full government support, facilities, a business-friendly environment and policies. At our EPZs we provide you with a huge number of incentives and exemptions,” he said.

The key features of Pakistan’s investment policy include, equal treatment to Pakistani and foreign investors, 100 per cent share holding in projects and businesses, an unlimited repatriation of the dividends, annual and accumulated profits. Highlighting these incentives, and still many more, the prime minister asked foreign investors, particularly those from Islamic countries, “to benefit from Pakistan’s EPZs.”
--------
“We at Al Tuwairqi, feel honoured in introducing the world’s most advanced DRI technology, based on the Midres process, owned by Kobe Steel of Japan, in Pakistan,” he said.

TSML is also embarking upon several new projects, subsequent to commercial operation of DRI project. It plans to work on the upstream and downstream production processes, involving billet/thin slabs production, and iron ore exploration in Pakistan, its beneficiation and pelletisation.

“As our social corporate responsibility, we are also focused on the clean power generation in Pakistan,” Dr Hussain said. “We see Pakistan as a land of immense opportunities. We are very clear in our perception that Pakistan, as a country has to grow, and we are determined to play an instrumental role towards its development. In the survival of Pakistan is the survival of the entire Muslim Ummah,” he said.

Posco chairman and CEO Joon-Yang Chung, said: “The TSML will significantly contribute towards Pakistan’s economy.”

“Today, Pakistan’s economic development and structural adjustment calls for a higher quality steel products to be manufactured in this country. At TSML, we will develop high-performance products, featuring high strength, corrosion resistance, sustainability and light- weight, and improve the technological competence related to such products. To add to its success, Posco is determined in building a successful partnership with Al Tuwairqi to benefit from its presence in Pakistan and is fully focused to make TSML a world class steel making unit through possible expansion of initially set DRI plant using forward and backward integration,” added Chung.

With all stakeholders so determined, and so upbeat, output of high-grade products, and larger investment inflows look all set to benefit Pakistan.


http://www.khaleejtimes.com/kt-article-display-1.asp?xfile=data/internationbusiness/2013/February/internationbusiness_February102.xml&section=internationbusiness

Riaz Haq said...

Here's ET on Karachi's booming stock market:

KARACHI: Even as most of the city remained shut on Monday owing to a strike call, the Karachi Stock Exchange’s (KSE) benchmark 100-share index gained 0.38% or 68.39 points to end at 17,865.61 points.

The rally was helped by positive news flows from multiple sources, prominent among which were expectations that the cement sector would record a surge in earnings due to stronger domestic sales, higher prices and lower input costs. Also featured was news that the Oil and Gas Development Company (OGDC) had signed direct agreements with fertiliser manufacturers for the supply of gas, and increased expectation that telecom companies will record higher revenues following Pakistan Telecommunication Company’s stellar profits on the back of higher international call termination rates.

Trade volumes remained flat at 292 million shares compared with Friday’s tally of 293 million shares. The value of shares traded during the day was Rs7.18 billion.

“Led by Engro and DG Khan Cement (DGKC), the Karachi bourse achieved a new high,” observed Samar Iqbal, equity dealer at Topline Securities. Both Engro and DGKC’s stocks closed at their upper price limits by the end of the day.

“The said agreement [between Engro and OGDC] will allow Engro to receive gas directly from gas fields, reviving financial prospects for its fertiliser business,” reported Sibtain Mustafa from Elixir Securities. “DGKC continued its positive momentum from last closing as news reports of a $45 billion deal between the Abu Dhabi Group and real estate tycoon Malik Riaz brought in fresh interest.”

Shares of 360 companies were traded on Monday. At the end of the day, 147 stocks closed higher, 161 declined while 52 remained unchanged. Pakistan Telecommunication Company was the volume leader with 29.23 million shares, gaining Rs0.82 to finish at Rs22.77. It was followed by Pace (Pakistan) with 26.60 million shares, gaining Rs0.39 to close at Rs4.32 and NIB Bank with 19.83 million shares, gaining Rs0.15 to close at Rs2.88.

“The majority of volumes were focused on third-tier stocks [...] as retail participation continues to rise. Furthermore, news of Ministry of Petroleum agreeing to increase POL margins by Rs0.25 per litre for motor spirit and Rs0.10 per litre for high-sulphur diesel brought interest in listed oil marketing companies near market end,” Mustafa added.

Foreign institutional investors were net buyers of Rs88.51 million worth of shares, according to data maintained by the National Clearing Company of Pakistan Limited.


http://tribune.com.pk/story/509210/market-watch-bourse-continues-climb-despite-strike/

Hopewins said...

^^RH: "Here's an ET report on exploding tobacco profits in Pakistan.."
----

Does ET has a report on the exploding healthcare costs associated with tobacco-consumption induced heart disease, cancer, emphysema etcetera?

While Pakistan Tobacco may be the single-largest taxpaying unit in Pakistan, does its tax contribution exceed the increase in healthcare costs triggered by rising tobacco consumption?

For a guy who loves to quote Arundhati Roy, Kapil Komireddy, Naom Chomsky et cetera, you seem to be pretty happy with the growth of the Tobacco Lobby in Pakistan....

Riaz Haq said...

HWJ: "For a guy who loves to quote Arundhati Roy, Kapil Komireddy, Naom Chomsky et cetera, you seem to be pretty happy with the growth of the Tobacco Lobby in Pakistan.... "

How did you conclude I'm happy about it?

Please read my earlier post about merchants of death eying Pakistan market.

http://www.riazhaq.com/2008/01/merchant-of-death-eyes-pakistan-market.html

Riaz Haq said...

Here's an AFP story on Pakistan's rising middle class consumption:

In a smart corner of Karachi, a new mall offers wealthy clientele the chance to lunch on an American burger, buy French cosmetics, shop for cocktail dresses, sip an afternoon cappuccino or wolf down a cinnamon roll.

Female sales assistants dressed in jeans and T-shirts buck the idea that “service industry” jobs are unsuitable for women, even if many of them commute into work heavily veiled to avoid being harassed or insulted.

“It is time when Pakistanis are getting branded. It is a new phenomenon,” says Samiullah Mohabbat, the chief executive who brought American franchise Fatburger from Beverly Hills to Karachi, a city troubled by shootings and kidnappings.

“The world has just started coming to Pakistan and this trend will grow.”

---
...the middle class has grown over the last decade. Karachi, the country’s financial hub, Lahore and the capital Islamabad have all seen a surge in Western-style coffee shops, fast-food franchises and new malls.

Karachi’s Dolmen Mall is the newest and flashiest.

There is Spanish fashion favourite Mango, US beauty and home firm Crabtree and Evelyn and British high street staples Mothercare and Debenhams.

---

Mohabbat has invested $7 million in opening Pakistan’s first Fatburger restaurant last month on the second floor of Dolmen Mall, with plans for another in Karachi, two in Lahore and a fifth in Islamabad.

Far from seeing the country’s troubles as a bar to business, Mohabbat says a $5.50 burger is the perfect antidote.

---
At lunch time, his 130-seat restaurant is buzzing. In Beverly Hills, there may be nothing exciting about going out for a burger, but in Karachi the novelty and the relative expense make it a sought-after privilege.

The walls are plastered with large notebook papers scribbled with the experiences of the clients. “Yummilicious,” screeches out one.

There is a scrum at the counters as customers wait their turn. A dozen workers cut and cook imported American beef, slathering it with spices and vegetables, shoving it in a bun and handing it to the waiters.

“It’s certainly quite expensive for the average Pakistani, but I prefer it because I can afford it,” says businessman Masroor Afzal, 44, who works round the corner and says he frequently pops over.

“The beauty of Karachi is that it has everything for everyone. There are many people who can’t afford to eat or shop here, but they have other bazaars.”

Analysts say there is enormous potential in Pakistan as a market for global consumer goods, despite the structural problems in the economy.

According to the finance ministry, 104 million people are aged 15 to 59 and by 2030, 30 percent of the population will be younger than 30.

Khurram Schehzad, head of research at investment firm Arif Habib Securities in Karachi, says consumer spending has grown 26 percent in Pakistan since 2010, compared to seven percent for Asia as a whole.

Business mogul Abid Umer says there is “tremendous potential” for retail.

His Al-Karam Group brought its first foreign franchises – Babyshop from Bahrain and Splash from the United Arab Emirates – to Pakistan in 2005. Today his portfolio has extended to Mango.

“Pakistan is full of aspirational customers,” said Umer.

“Sure, Pakistan has its share of issues but in most cases, day to day life is not affected, plus the tremendous customer response and low cost of operations makes it worthwhile.”

---

Helen Lacey, Debenhams’ senior PR manager, told AFP the company had carried out extensive market research and had “no current security concerns”.

“International brands in Pakistan in general are performing strongly. This is a large and growing market and there is a clear appetite for British brands here and growth potential with a rapidly growing middle class,” she said....


http://dawn.com/2013/03/03/pakistans-middle-class-defies-conservative-stereotype/

Riaz Haq said...

Here's a Nation story on US Amb Olson's visit to Sialkot:

Ambassador Olson toured the Sialkot International Airport, the Silver Star Group, and KM Ashraf Industries.
He also met with the executive board of the Sialkot Chamber of Commerce and Industry. In Lahore, Ambassador Olson congratulated U.S. companies for their work in Pakistan, including corporate social responsibility programs, at the annual dinner of the American Business Forum.
“The United States stands with many entrepreneurs here in Sialkot and across Pakistan as you develop your businesses,” said Ambassador Olson during his visit to Silver Star in Sialkot. Silver Star produces nearly 70% of the hand-stitched footballs sold by the U.S. firm Nike.
“The United States is among the largest investors in Pakistan, and Pakistan exports more products to the United States than to any other country in the world,” he added. Ambassador Olson underscored this point during a visit to KM Ashraf Industries, which exports more than $20 million worth of sports uniforms to the United States each year.
At the Sialkot International Airport (SIAL), Pakistan’s first privately-funded international airport, Ambassador Olson congratulated the management team for recent upgrades that allow the airport to carry the load of 10 jumbo planes, benefiting hundreds of businesses and more than a million travelers each year. “This is a clear example of how private-sector funding can be used to meet the needs of the business community. SIAL is a model for other cities in South Asia,” said the Ambassador.
At a lunch meeting with the executive board of the Sialkot Chamber of Commerce and Industry, Ambassador Olson discussed opportunities to further strengthen ties between U.S. and Pakistani businesses. He also reminded Chamber members that businesses can take advantage of the U.S. Generalized System of Preferences (GSP), which allows more than 3,500 Pakistani goods to enter the United States duty free.
Ambassador Olson will cap off his private-sector meetings in Punjab by recognizing the corporate social responsibility efforts and strong business ethics of U.S. companies working in Pakistan at the American Business Forum annual dinner in Lahore.
Throughout his visit, Ambassador Olson highlighted several examples of Pakistani entrepreneurs who have benefited from U.S. economic assistance. U.S. economic assistance helps businesses create jobs and boost incomes with projects that expand Pakistan’s agricultural output. U.S. assistance is building roads to facilitate trade and will offer a private equity fund to help small and medium-size businesses expand.


http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/national/03-Apr-2013/olson-stresses-pakistan-us-economic-ties-on-punjab-trip

Riaz Haq said...

Here's an excerpt of a Reuters' report on Karachi shares market:

The market's benchmark index continues to soar to record highs -- up 10.34 percent year to date -- fueled in part by expectations May elections will mark Pakistan's first transfer of power from one democratic government to another. Previous civilian governments were all dismissed by Pakistan's ultimate power: the military.

"Pakistan has a lot to offer investors and this is our chance to show it," said Nadeem Naqvi, the KSE chairman. He plans to embark on a series of roadshows for potential foreign partners that will take him to London, Frankfurt and Hong Kong in the coming months.

Many of the companies listed on the KSE offer double-digit returns, low stock prices and resilient business models in this frontier market with a population of 180 million. The index still has an attractive price/earnings ratio of $8.50 despite the soaring returns of the past few years.

Pakistan now has a 4 percent weighting in the MSCI Frontiers Market Index and has become somewhat of a discovery for foreign investors chasing new markets and yields.

THE SEAMIER SIDE

But the KSE's spectacular rise last year can at least be partly attributed to another factor entirely - the cleansing of "black money".

The market took off last year just as a government decree was finalized allowing people to buy stocks with no questions asked about the source of the cash. Average daily volume more than doubled last year to 173 million shares from 79 million in 2011.

Authorities say the measure will bring undocumented funds into the tax net in a country where few pay taxes. But some critics decried it as a gift to corrupt officials and criminals seeking to launder dirty cash.

"Politics and dirty money go hand in hand in Pakistan," said Dr. Ikramul Haq, a Supreme Court lawyer and a professor on tax law.

"People want to be outside the regulatory framework and outside the tax net."

-----
The Securities and Exchange Commission of Pakistan (SECP) said it found 23 violations of securities laws that merited fines in fiscal year 2011-12 (April/March). The market regulator sent warning letters in another 19 cases, it said in its annual report. (www.secp.gov.pk/)

That's a drop in the bucket, says Ashraf Tiwana, dismissed as head of SECP's legal department after years of clashes with his bosses over fraud in the market. He has petitioned the Supreme Court to replace the SECP chairman and commissioners.

"There's a lot of fraud, a lot of market manipulation ... but not enough action has been taken, especially not enough criminal action has been taken," Tiwana told Reuters. "They're just passing small fines and giving out warning letters."

Regulators are too close to the market, Tiwana said. The head of the stock exchange is a former broker and the two top members of the SECP are former employees of Aqeel Karim Dhedhi, founder of one of the country's biggest brokerage houses.

BIG DHEDHI

Nicknamed "Big Dhedhi" for his ability to move markets, Aqeel Karim Dhedhi heads one of Pakistan's largest domestic conglomerates, the AKD Group.

Lately, the well-known philanthropist and leading member of Pakistan's business establishment has been trying to fend off arrest over allegations of insider trading.

An SECP investigator accused traders, including Dhedhi's brokerage, of buying shares in a state-run Sui Southern Gas Co before an official announcement allowing the company to raise its prices. In the weeks before Sui Southern's announcement, the stock price jumped from 13.5 rupees to 20 rupees, its biggest hike in five years.


http://www.reuters.com/article/2013/04/09/us-pakistan-stockmarket-insight-idUSBRE93813Z20130409

Riaz Haq said...

Here's a Daily Times on Al-Tuwariqi steel reaching full production:

* Plant runs at 100 percent of its rated capacity within 4 months of its launch

KARACHI: Tuwairqi Steel Mills Limited (TSML), Pakistan’s first private sector integrated environment-friendly steel manufacturing complex and a joint venture of Al-Tuwairqi Holding (ATH)/ISPC of the Kingdom of Saudi Arabia and the world’s third largest steel maker POSCO has recorded the ever highest production of an iron making plant in Pakistan during the Plant Demonstration Test (PDT) conducted in the expert supervision of MIDREX, USA.
During the PDT, the plant ran at 100 percent of its rated capacity i.e producing 160 tonnes of high quality Direct Reduced Iron (DRI) per hour for 72 hours achieving all of its operational targets. This development comes at a crucial juncture when Pakistan’s current per capita steel consumption is only 40 kilogram, which is exuberantly low, when compared with the global average of 215 kilogram. This establishes a dire need and increased emphasis on achieving international benchmarks to become a modern and an efficient economy.
Dr Asif Brohi President National Bank of Pakistan congratulated the entire team of Tuwairqi Steel Mills on achieving this milestone and appreciated their enthusiasm and technical expertise.
It is heartening to observe TSML has already increased the production capacity of Pakistan by 1.28 million tonnes per annum, which would help meet the ever growing demands of steel in Pakistan and with its massive expansion and modernization plans, Al-Tuwairqi is poised to transform the country into an industrial hub, he added.
Zaigham Adil Rizvi Director (Projects) TSML said, “We are committed to our vision to participate in the development of national economy in order to have a long sustaining growth of Pakistan.”
During the PDT, Chang Hee Lee Council General of South Korea, Rahat Kamal DMD SSGC, Major General Javed (r) Chairman Pakistan Steel Mills; Zubair Motiwalla Chairman Sindh Board of Investment, Waqar Ahmed Hashmi DMD KW&SB and Ghulam Rasool Shiekh from EPZA were also present.
Al-Tuwairqi kicked off the commercial production of TSML’s 1st phase in January this year-a Direct Reduction of Iron (DRI) making plant with the capacity to produce up to 1.28 million tonnes per annum of high quality DRI, which is evidently steel’s most versatile metallic and a preferred raw material for quality steel making worldwide.


http://www.dailytimes.com.pk/default.asp?page=2013%5C05%5C24%5Cstory_24-5-2013_pg5_5

Riaz Haq said...

Here's a Nation report on opening of Ocean Tower in Karachi:

The Ocean Mall has opened the doors to luxurious shopping experience, the first of its kind shopping center in Karachi, specially designed to offer a unique and glamorous experience that is not available elsewhere in Pakistan.
The Ocean Mall is spread over four floors with the local and international renowned brands outlets. The Ocean Mall is one of the Karachi’s leading shopping leisure and entertainment destinations and it presents local and internationals stores from fashion to food, high street brands to luxurious collections.
The best part about the Ocean Mall is its parking which has four floors of parking. Large numbers of people from every walk of life and dignitaries also visited Ocean Mall and expressed the hope that it will restore image of Karachi.


http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/04-Jun-2013/mutawalli-e-ka-bah-visits-karachi-s-tallest-building

Riaz Haq said...

Here's World Cement report about cement consumption in Pakistan:

The All Pakistan Cement Manufacturers Association reported a 10.10% increase in domestic cement consumption in January. The country, which has almost 45 million t of cement capacity, has seen exports fall in recent years as expansion programmes increase capacity in Pakistan’s traditional export markets and new exporters have joined the competition. However, domestic demand is on the rise, hitting an all-time high of almost 24 million t in FY11/12.

January saw domestic sales reach 2.135 million t, comprised of 1.706 million t from the north and 429 000 t from the south of the country. Demand has been pushed by private construction as well as government infrastructure projects, a trend set to continue as the per capita cement demand in the country is well below average at 152 kg.

Energy shortage threatens production

However, a new threat is energy shortages, which the APCMA says hampered production in northern areas last month. The Islamabad High Court recently removed the Rs.50/mmbty Gas Development Infrastructure Cess (GIDC), declaring it illegal. Though this will bring down input costs for cement producers in the south, it is reported that it will have no benefit for the more numerous northern producers, who ‘have now been given least priority for gas supply’ (The Nation, 3 February). Some plants are looking into alternative energy supplies – DG Khan Cement, for example, is set to be one of the first applications for Kalina cycle technology in the cement industry.

Lucky Cement prospers

Meanwhile, Lucky Cement Limited has recorded a 42.15% y/y increase in half yearly profit for 2012/13. As of the end of December, the company reported profits of Rs.4.29 billion and improved net sales of Rs.17.511 billion, up 13.9% y/y. The company reportedly plans to upgrade its existing mills and packing machines to reduce operational costs. More information about the company can be found in the February issue of World Cement in the article ‘Pakistan: Cementing its Position’ from Lucky Cement. Subscribers can download the issue by signing in.

Lafarge appoints new country CEO

Finally, Lafarge Pakistan Cement has appointed Amr Reda as the new country CEO of Lafarge Pakistan. Reda had previously been the regional business controller of Lafarge Middle East and Pakistan and has been on the board of directors of Lafarge Pakistan since January 2007.


http://www.worldcement.com/news/cement/articles/Pakistan_domestic_cement_consumption_rises_854.aspx

Riaz Haq said...

Here's News story on gated communities in Karachi:

KARACHI: Nestled between Safari Park and apartment complexes that define Gulistan-e-Jauhar; lies the KDA Overseas Housing Society. Getting inside the securely guarded compound means offers a glimpse into a lifestyle very different from the crime infested areas that surround the society.

Children are seen riding merrily on their bikes with no adult supervision, while families and individuals can enjoy a peaceful evening along tree covered lanes.

It’s a scene that is at odds with what goes on outside. In general, Jauhar – as it’s called – remains crime ridden and violence prone. Most residents wouldn’t dream of a walk on their own, let alone with families. Increasingly, those who can afford it are moving to safer locales – the overseas society amongst them.

It’s a trend that’s increasing across the city. Gated communities in Karachi have increased by at least 20 percent due to the volatile law and order situation.

The rising threats of kidnapping for ransom and extortion are also major reasons that citizens prefer to live in barred streets.

However, as supply remains limited, gated communities tend to be expensive. Aqeel Karim Dhedi, Chairman of AKD Group, said peole prefer Clifton and Defence due to stability in rental and sale prices.

Dhedi said gated communities have better security arrangements. No outsiders are allowed to enter without reference from residents. This enables residents to enjoy a peaceful environment with their families. Children can move around without any fear. He added that new gated communities are offering a variety of facilities including sports complex, parks, health club, and play grounds, super markets, mosques, schools, shopping arcades, health centers and much more.

Besides the luxuries, another reason to move into a gated community is that it reduces the maintenance cost for security, sanitation, and other general utilities as a fixed monthly charge. The same is much higher in case of a normal residence. For example the maintenance cost in Creek Vista apartment is Rs.10,500 with additional charges for generator and water.

But it’s the new upcoming projects - apartments and houses that redefine the elite urban living experience- that are gated communities in the real sense. Apartment complexes include high speed and personal elevators, servant quarters and backup power. All things required for everyday existence will be available within their barriers.

Mohammad Shafi Jakvani CEO CITI Associates deals with properties in Defence, Clifton, and Shara-e Faysal. He said that the demand for gated community has made their prices appear to be on fire.

This demand that has led to the development of schemes such as LuckyOne at Rahid Minhas Road, BT Icon in Clifton, Com3 Clifton and AKD’s ARKADIAN in Defence Phase VIII. A joint venture between DHA and AKD group, it’s expected to be launched just after Eid. The prices are expected to be in the range of Rs.40million to Rs.50 million, Mohammad Shafi Jakvani said.

Com3’s prices are in the range of Rs.20million to 40 million depending upon the size and location of the property. Three to four bed rooms apartments and duplex houses (two floor apartments) are being offered on 40 months installments, a Com3 Official told the News.

LuckyOne is the first project to offer high end residences for the upper middle income group in the down town area. There will eight towers 1232 apartments of three and four bedrooms, with all facilities available in any of the upcoming gated communities. The most important thing is that the project will generate power itself to avoid load shedding, said Nasir Aziz, technical director at Luckyone .


http://www.thenews.com.pk/Todays-News-3-192729-Gated-communities-offer-security-to-beleaguered-Karachiites

Riaz Haq said...

Here's UAE's National newspaper story on real estate sector in Pakistan:

The government spends more than US$5 billion on construction from its annual development budget. The housing sector, however, gets less than half of the amount allocated for construction each year. The burgeoning population and rapid urbanisation calls for more housing schemes in the country. Private real estate developers have a crucial role to meet housing.

In view of the security concerns, private developers have resorted to building gated communities in major cities. Pakistan’s Bahria Town is Asia’s largest real estate developer and private housing society, which has practically implemented the idea of foolproof safety. Bahria’s ongoing projects, such as the JV D&B Valley, Golf City, Garden City, Bahria Icon, cover more than 1 billion square feet that will accommodate more than 1 million residents. Bahria’s 25,000 employees are delivering US$5 billion of iconic developments.

Administered by the Pakistan army, Defence Housing Authority (DHA) is a real estate organisationthat mainly develops housing for current and retired military officers. DHA has establishments in all the major cities including Karachi, Lahore and Islamabad. DHA City, one of the largest state-of-the-art residential-cum-commercial projects, is under construction in Karachi. DHA has also built gated communities. And the prices of residential and commercial property in DHA housing schemes have been on the rise.

Launched in 2008, DHA Valley is a joint venture of DHA, Bahria Town and Habib Rafiq Private. The project aims at developing a secure community with essential amenities. DHA Valley offers 1,125 sq ft and 1,800 sq ft residential plots for 650,000 Pakistan rupees (Dh22,749) and 880,000 rupees respectively, with a quarterly instalment plan for Pakistani residents. It also offers1,800 sq ft residential plots for US$12,900 for overseas Pakistani residents.

The winner of five awards from the Asia Pacific International Property Awards, Bahria Town is actually fuelling the growth of real estate sector in the country.

Bahria’s projects in Rawalpindi and Islamabad and the development of a gated community worth $6 billion in the twin cities is the great property success story. The amenities offered by Bahria Town attracted residents and allured real estate investors. It ensures a 24-hour supply of electricity, fool-proof security and other amenities. The value of real estate in the Bahria towns in Lahore, Islamabad and Rawalpindi has increased manifold in the past five years. The price of a 1,800 sq ft residential plot at Bahria towns in Lahore and Rawalpindi has increased up to 5 million rupees from 1.5m rupees in just three to four years.

Karachi, the country commercial capital, has endured stagnancy or a fall in property prices because of deteriorating law and order over the past five years. Bahria Town has come forward as the answer to many of the problems confronting the real estate investors. Bahria town Karachi is currently the focus of speculative trade in real estate. Frenzied investors are ready to offer triple the price for plot files. What is really a commendable the properties are financially accessible to the middle class. For example in the newly launched Bahria Town scheme in Karachi, the price for a 1,125 sq ft residential plot is 2.6 million rupees, while the price of a 2,160 sq ft plot is more than 5m rupees. Similarly, the price a two bed apartment is 2.6m rupees, while the price of four-bed apartment is 8.2m rupees. These properties can be purchased through instalments under a five-year plan.


http://www.thenational.ae/business/industry-insights/property/property-sector-aims-to-put-down-firm-roots-in-pakistan

Riaz Haq said...

Here's an Express Tribune story on real estate sector in Pakistan:

After passing through a correction phase of nearly five months, the real estate market in Lahore is once again on the path of growth. However, there are a number of reasons why the extent of the growth may not meet investors’ expectations.
For the past few years, developers, after failing to find a suitable place in Lahore, have tended to focus on neglected but other populous cities of Punjab including Multan, Faisalabad, Gujranwala and Sialkot.
Hashu Group is one of them, Bahria town, city housing schemes (once a part of Bahria town) are the others. The latest name is the Defence Housing Authority (DHA). Since DHA is the most trusted name for any investor – in Pakistan and overseas – people find a reasonable alternate to invest.
Gujranwala, Multan and Bahawalpur are three cities where DHA has planned to establish housing societies, among which the sale and purchase for DHA Gujranwala has already kicked off. Such developments are observed as a positive for the long-term growth of the real estate sector.
“This spread out is good for the market in general,” said Mian Talat, chief executive officer at Talat Enterprisers, a real estate firm. “People now have more choices to invest and live according to their convenience.
The correction in the Karachi Stock Exchange is also a factor behind the recovery of the real estate market recovery.
Common investors of both markets believe that the KSE may crash any time. Given the situation, investors tend to switch to the real estate market. When stock index starts declining, many investors switch over to the real estate market and this is what is happening exactly now”, Talat added.
Few years back, Lahore, Karachi and Islamabad/Rawalpindi were the only places where investors found some room to put their money in for some profits. However, these cities are now pushing their limits — Lahore’s boundaries are now merging with some of its districts due to various factors.
Property prices in Lahore, despite almost a 20% correction in these five months, are quite abnormal. It is hard to find a piece of one kanal of land in a decent housing scheme below Rs10 million. If the same amount of land is located in a prime location inside a housing schemes then the price exceeds Rs20 million.
“Since Lahore is one of the major beneficiaries of the real estate boom, it is unlikely that real estate activities are stalled in the future. This is due to developments of housing schemes in other cities”, said Waseem Tariq, Chief Executive Officer of F-1 Properties. “The price fluctuation mechanism for real estate, as per our expectations, will be solid now.”


http://tribune.com.pk/story/675018/real-estate-market-hits-growth-trail-again/

Riaz Haq said...

Here's a Wall Street Journal story on multi-screen theaters construction boom in Pakistan:

KARACHI, Pakistan—At the brand-new Nue Multiplex here, chauffeured cars drop families at the door. Excited squeals of children reverberate from the games arcade. Hollywood and Bollywood movies play on five screens.

"We wanted to have something of international standard," said Tariq Baig, executive director of the $100 million multiplex that opened in August, replete with a Canadian sound system, Danish carpeting, and chairs and screens imported from the U.K. "We didn't go for anything local."

Nue is part of a wave of Western-style cinemas that are opening across Pakistan, aiming to serve the entertainment-starved middle classes in a country where movie houses were traditionally dilapidated, seedy, and shunned by families.

The blossoming of Western cinema in Pakistan is something of a phenomenon, taking place even as Islamist militants—who view all cinema as sinful— increasingly target the country's moviegoers.

There are just 104 movie screens in all of Pakistan, a country of 180 million people. Still, that is a jump from 20 screens in 2005, according to various distributors and cinema owners. There are another 100 screens under construction, they say.

Pakistan's cinema renaissance began in 2006, when the then military dictator, Pervez Musharraf, loosened a law dating back to the 1965 war between India and Pakistan that banned the import of Bollywood films. Though imports of Indian movies are still restricted, Mr. Musharraf's ruling allowed them to be granted a "No Objection Certificate" by the government in special cases. The ordinance also created a loophole in the law that allowed Indian films to be imported via another country.

"Everyone wants to go to the cinema," says Nadia Jamil, a popular TV and film actress based in Lahore. "It's the Indian films that have created the market that everyone wants to rush to."
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Cinema construction has been on a tear over the past few years in a number of developing countries where growing middle classes are flocking to theaters. China last year added 5,077 new film screens, boosting its total to 18,200, according to the official Xinhua news agency.
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Peshawar's cinemas are a far cry from the multiplexes of Lahore, Islamabad and Karachi. The only defense against the intense summer heat are ancient fans. In the winter patrons come with their own blankets. The audiences are exclusively male, and many of the theaters show porn, crudely dubbed into Pashto, the local language. Audiences are small and profits are slim. Tickets cost around 50 rupees (50 cents), depending on how popular the film is.

Habib ur Rehman, the manager of the Picture House cinema, the first theater to be attacked by the Taliban, said in conservative Peshawar being in the cinema business isn't something you boast about. He said the modern multiplexes springing up in other parts of the country would never come to the city. "They will not succeed here. The people don't like Hindi and English films. They want Musarrat Shaheen, " he said, referring to a famous Pashto actress.

Despite the Taliban threats, Rehan Shah, who works at the Shama Cinema, the second Peshawar theater attacked, said people are eager for these cinemas to reopen.

"People are already asking, 'Why are you not open? We want entertainment,' " he said.



http://online.wsj.com/news/articles/SB10001424052702303546204579439371307729670

Riaz Haq said...

Here's Tech In Asia on Pakistan's online real estate listings portals:

In Pakistan, one homegrown startup is now facing a wave of overseas tech companies entering the country as more investors see the appeal of this growing – yet troubled – emerging market. In the online property listings niche, Zameen started early, founded by British-Pakistani entrepreneur brothers Zeeshan Ali Khan and Imran Ali Khan way back in 2006. It then grew to become the nation’s top real estate site. According to Shehryar Qureshi, Zameen’s marketing manager, it now covers 500,000 verified listings of places to rent or buy across Pakistan. Despite Pakistan having barely 15 million mobile internet users (from about 130 million total mobile SIM subscribers), foreign firms are rushing in to compete in some of the most easily monetizable parts of the web – things like ecommerce and ad-supported web portals. That includes online property listings. As a consequence, Zameen is now up against classifieds sites like OLX Pakistan (a branch of Argentina-born OLX) and the brand-new Dekho.com.pk (created by Sweden-based venture incubator Saltside, which got US$25 million in funding last week to expand into more emerging nations). But Zameen’s biggest challenger is a dedicated property site of the same genus – Rocket Internet’s Lamudi. Lamudi launched in Pakistan in January this year, marking the 16th nation entered by this spin-off from the German startup dynamo that is Rocket Internet. It’s more like Zameen than any other competitor and is the rival most likely to scale quickly. It’s part of a huge push into Pakistan by Rocket, which now covers seven startup sites in the nation. See: The future of the mobile internet is in Asia So far, Zameen is keeping its lead. Aside from having more listings, Qureshi says that the incumbent site is ahead with 700,000 monthly visitors in Pakistan alone. Qureshi points out that Zameen is adding more funding and extra know-how to prepare it for the tougher battle ahead. Last month Zameen secured an undisclosed amount of funding from Singapore’s Catcha Group and Malaysia-based Frontier Digital Ventures that gives the new investors a collective 30 percent stake. That also brings in expertise from Frontier Digital Ventures co-founder Shaun Di Gregorio, the CEO of iProperty, who joins the startup’s board of directors. Earlier in 2012 a similar thing happened when French investor Gilles Blanchard, who co-founded SeLoger, France’s largest property portal, came on board as an angel investor and also took up the role of Zameen chairman. Since the startup’s founders are part of the Pakistani diaspora, the business is taking into account the spending power of the nation’s overseas businesspeople. That’s why Zameen has extra offices in London and Dubai, catering to members of the diaspora looking for property investment opportunities in their home country.

Read more: Pakistan’s Zameen braces for growing competition from every startup’s nemesis: Rocket Internet....


http://www.techinasia.com/pakistan-zameen-property-portal-battles-rocket-internet-lamudi/

Riaz Haq said...

Local sales of the cement industry posted a growth of 9.85% during the first quarter of the current fiscal year, compared with the same period previous year.
Exports, however, recorded a decline by 8.13% compared with exports during the first quarter previous year.
The overall situation during the first quarter of the current fiscal year showed a 4.68% growth compared to the same period last year. Cement dispatches to domestic markets during September 2014 were 2.42 million tons compared with 2.12 million during the same month last year, depicting an increase of 13.86%.
Exports during September 2014 were 730,000 tons against 816,000 tons during September 2013, showing a decline of 10.6%. Total dispatches during September 2014 were 3.15 million tons compared to 2.94 million tons during the same month last year.

According to the All Pakistan Cement Manufacturers Asso­ciation (APCMA), the industry has been struggling against the high duty structure, impractical imposition of maximum retail price (MRP), increasing import duties on coal, increasing power tariffs and axel load restrictions.
Additionally, an added issue for the industry is the growing trend of smuggling from Iran.
Domestic cement uptake in the southern region is being seriously affected due to unregulated smuggling of cement from Iran. Statistics showed that against a 10.8% increase in domestic sales in the northern region, domestic sales in the southern region showed an increase of only 5.4%.

http://tribune.com.pk/story/771101/local-sales-of-cement-industry-rise-9-85/

Riaz Haq said...

Pakistani cement sales volumes up almost 9% in first 4 months

In Pakistan, cement sales have reportedly grown 8.87% in the first four months of the current fiscal year, reaching more than 8 million t. Customs Today reports that overall exports decreased y/y to 2.79 million t, a 4.43% drop.

There is something of a north/south divide in sales, with the northern region seeing a 10.4% gain in domestic sales but a 12.3% drop in exports, while southern cement producers reported a much smaller increase in domestic sales but a 12.5% increase in exports.

The All Pakistan Cement Manufacturers Association has reportedly claimed that government inaction has impeded industry growth. Fuel and power cost increases have put pressure on companies’ margins, as shown in the quarterly results reported last month. Increased taxes were also reported as an issue affecting the companies’ bottom lines.

http://www.worldcement.com/news/contracts/articles/Pakistani-cement-sales-volumes-up-almost-9-percent-in-first-4-months-838.aspx

Riaz Haq said...

With over 6% growth in sales in the first seven months of the current fiscal year, analysts say the cement industry is set to post highest-ever growth rate in the last five years.
This growth is more important for the cement industry officials as it is mainly based on local sales unlike the pre-2010 period when the industry used to equally rely on exports.
“Cement industry’s domestic sales have surprised everyone and the growth has surpassed all market estimates. Industry is likely to grow over 6% as it has risen in the first seven months (Jul-Jan 2014-15),” industry analyst Saad Hashmi commented.
Average growth in cement production was just 2.9% in the last three years. However, cement sales have shown an exceptional 6.2% growth in the first seven months in fiscal year 2015. Even if the industry succeeds in maintaining the current growth at the end of the fiscal year, it will be the highest expansion rate in the last five years.
Cement production posted the highest-ever number of 34.28 million tons in the last fiscal year 2013-14. Dispatches increased to 20.02 million tons during the first seven months of 2014-15 compared to 18.86 million tons in the same period of previous fiscal year. This means the industry can touch 36.6 million tons by the end of June 2015 if it grows at the current pace of 6.2%.
In all likelihood, Hashmi said the cement industry will succeed in maintaining 6% growth because the remaining five months (February to June) are all those in which the construction activity remains high.
Owing to the continuous decline in cement exports over the last five years, the industry is increasingly dependent on local sales. The impact of the rise in domestic consumption is so strong that while issuing the latest data, the spokesperson for the All Pakistan Cement Manufacturers Association recently claimed, “higher cement uptake depicts a turnaround in the economy.”
Commenting on the ‘immense satisfaction’ of the industry from rising domestic demand, he said cement companies have been reaping the benefits of record low international coal prices that have significantly reduced the cost of production.
Construction sector
Association of Builders and Developers Pakistan (ABAD) former senior vice chairman Saleem Kassim Patel told The Express Tribune that the private sector is showing a strong growth, which is one of the main causes of high cement consumption in the country.
“There is a huge backlog of houses, which is why this sector will continue to attract investments. What is more important is that the current rise in construction activities can turn around the economy if the government starts supporting it,” said Patel.
However, one of the biggest hurdles to the fast growth of the construction sector is the moratorium on new gas connections for high-rise buildings. Without gas, thousands of already constructed residential buildings are still unoccupied, causing financial losses of millions of rupees to the builders and their clients, he added.
Owing to the growing shortage of gas, the PPP-led previous government banned all new gas connections to CNG stations, high-rise buildings and industries in 2011. Since then, builders and developers say the ban has been proving damaging for new investments in this sector.

http://tribune.com.pk/story/833623/cement-industry-sector-likely-to-post-highest-ever-sales/

Riaz Haq said...

Domestic cement sales are up 9% year-over-year for the first 7 months of Pakistan's Fiscal 2014-15, according to media reports. Overall, cement industry reports cement shipment of over 20 million tons in 7 months, a 6% annual increase with rising domestic demand offsetting falling exports due to weakness abroad.

Market capitalization of Pakistani cement companies has jumped 70% last year, about 3 times more than the KSE-100 market index which rose 27% in 2014. This is the third consecutive year that cement companies have outperformed the broader market. Investors in Pakistan's cement sector have seen 600% rise in the last three years.

It appears that construction sector is getting a boost from falling inflation and declining interest rates with a big drop in world oil prices.

http://www.riazhaq.com/2015/02/record-cement-sales-raise-hopes-of.html

Riaz Haq said...

Last year, the world produced 3.6 billion tons of cement—the mineral mixture that solidifies into concrete when added to water, sand and other materials—and that amount could increase by a billion tons by 2050. Globally, the only substance people use more of than concrete, in total volume, is water.

Cement’s virtues, Vlasopoulos says, have long been plain: It is inexpensive, pourable and, somewhat inexplicably, becomes hard as a rock. But one other important detail is seldom acknowledged: Cement is dirty. Not dirty as in it won’t come off your clothes—although that problem has dogged construction workers for centuries. The key ingredient is limestone, mostly calcium carbonate, the remains of shelled marine creatures. The recipe for making cement calls for heating the limestone, which requires fossil fuels. And when heated, limestone sends carbon dioxide gas wafting into the atmosphere, where it traps heat, contributing to global warming. Cement production is responsible for 5 percent of the world’s human-produced carbon dioxide emissions; in the United States, only fossil fuel consumption (for transportation, electricity, chemical manufacturing and other uses) and the iron and steel industry release more of the greenhouse gas. And with booming countries such as China and India using cement to construct their rise, cement’s dirtiness looms as one of the foremost downsides of globalization.
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People have been trying to build a better cement since just about the beginning of history. More than 2,000 years ago, the Romans devised a mixture of lime, volcanic ash and chunks of stone to form concrete, which was used to make harbors, monuments and buildings—the glue of early cities—including the Pantheon and the Colosseum. In the 1820s, in Leeds, England, about 200 miles from Imperial College, a stone mason named Joseph Aspdin invented modern cement. Aspdin heated a concoction of finely ground limestone and clay in his kitchen. After he added water, the mixture hardened. Voilà—the building block of the Industrial Revolution was born. Because the material looked like a popular building stone from the Isle of Portland, Aspdin called his invention Portland cement. The patent, issued in 1824, was for “an improvement in the mode of producing an artificial stone.”

The Australian developers had tried a new recipe, mixing Portland cement with magnesium oxide. They hoped to reduce carbon emissions because magnesium oxide can take the place of some of the limestone, and magnesium oxide does not have to be heated at such a high temperature. Limestone must be heated to 2,600 degrees Fahrenheit, but magnesium oxide can be prepared for cement at 1,300 degrees, a temperature that can be attained with biomass and other fuels that release less carbon, cutting down on fossil fuel consumption.

But Vlasopoulos quickly discovered that the blend did not reduce overall carbon dioxide emissions. In some tests, the emissions nearly doubled, because magnesium oxide itself is produced by heating magnesium carbonates, a process that releases carbon dioxide.

“I remember feeling very disappointed because when you see that the project you’re working on is not actually what you thought it was going to be, you lose motivation,” he said. “But we felt it was a very worthwhile project, a worthwhile idea, so we tried to find another way to solve the problem.”

At the time Vlasopoulos took up the question, in 2004, big cement firms around the world were looking for new ways to make Portland cement more environmentally palatable. The producers added steel byproducts, such as slag; coal residues, such as fly ash; and other materials, such as magnesium oxide, to bulk up the cement mixture, requiring less Portland cement. They experimented with mineral additives to reduce the temperatures needed to prepare the materials.




Read more: http://www.smithsonianmag.com/science-nature/building-a-better-world-with-green-cement-81138/?no-ist

Riaz Haq said...

#Pakistan real estate Boom: #Karachi and #Islamabad markets record gains http://tribune.com.pk/story/921613/real-estate-karachi-and-islamabad-markets-record-modest-gains/ …

When prices of real estate stagnated in 2014, all eyes were focused on the next year with hopes that it would bring along some momentum in the market. Truly, the much-needed activity emerged, though in part, in the first half of this year.

In almost all popular localities in Karachi and Islamabad, property prices went up over the six-month period from January to June 2015, showed data released by zameen.com, a property portal of the country.

Lahore, however, continued to record sluggish activity with prices remaining static this year as well. But this is not a worrying sign. The property market of Lahore often slows down when investors pay more attention to real estate developments in the country’s capital as well as in Karachi.



In an encouraging development, several new projects are on the cards in Lahore, including the 60,000-kanal LDA City and the 40,000-kanal DHA Phase IX. These and other projects are widening the scope of investment opportunities in the city, which will help steady the property market in the long run.

In the first half of 2015, one of the top localities in the city, Lahore Cantt, registered a decline of 9.29% in prices while real estate markets in DHA Lahore, Bahria Town and LDA Avenue-I remained stable.

Average price for a one-kanal plot went down only 1.02% in DHA Lahore in the first half whereas in Bahria Town the same plot cost 3.26% more over the same period.

Similar stability was noted in LDA Avenue-I, where average price for a one-kanal plot edged up a negligible 1.05%.

Though Johar Town continued to offer one of the highest rental yields at 4.26%, DHA Lahore and Lahore Cantt remained the more expensive neighbourhoods. On average, a one-kanal house in the localities cost Rs36 million and Rs37.5 million respectively.


Here, three of the four popular localities recorded decent gains in the first half, with Bahria Town the only top locality posting a slight drop in property prices. In comparison to the miserable second half of 2014, this was a good turnaround for the real estate market in the capital.



A moderate growth was noticed in Sector F-11 and DHA Islamabad as prices of one-kanal plots rose 6.05% and 6.96% respectively. There was also a modest growth of 6.39% in plot prices in Sector E-11.

Bahria Town, however, remained stable with a slight dip of 1.20% in one-kanal plot prices in the first half of the current calendar year.

Sector F-11 was one of the most expensive areas for buying one-kanal houses in Islamabad with an average price of Rs68.2 million. It was closely followed by Sector E-11 where average prices were Rs62.9 million for a one-kanal home.

However, Bahria Town, despite a slight dip in average prices, offered a high rental yield at 4.35%.

With investor focus squarely on Karachi for several months now, the city’s top localities have seen decent rises in prices as well as hectic activity in the first half despite Ramazan and a deadly heatwave.

Gulshan-e-Iqbal and DHA City Karachi recorded handsome price increases whereas DHA Karachi and Bahria Town also posted healthy gains to play their part in a very encouraging overall performance.

Prices of a 500-square-yard plot in DHA Karachi showed a restricted – by Karachi standards – growth of 6.09% while Bahria Town posted a healthy rise of 9.85%.

Prices went up 12.36% in Gulshan-e-Iqbal and 12.23% in DHA City Karachi, indicating a satisfactory and controlled growth.

DHA Karachi was one of the costliest neighbourhoods for buying homes with average sale price of Rs58.9 million for a 500-square-yard house.

Though Gulshan-e-Iqbal offered a relatively higher rental yield at 5.01%, average house prices stood at Rs37.4 million in the locality, well short of the prices prevailing in DHA Karachi.

http://tribune.com.pk/story/921613/real-estate-karachi-and-islamabad-markets-record-modest-gains/

Riaz Haq said...

What lies behind the gates of #Pakistan's growing elite gated communities? #construction #housing #Cement #Steel http://herald.dawn.com/news/1153455

Inside the gates, the never-ending sectors and undulating roads, the scarce traffic and abundant space can be extremely disorienting. If you are a first-time visitor, you can be forgiven for thinking this expansively designed neighbourhood is Islamabad’s actual twin city, and Rawalpindi just an unplanned appendage.

Driving on Bahria Town’s carpeted tarmac is a fairly docile affair after negotiating the violent potholes and sadistically narrow roads that pervade most of Pakistan. The sculptures of farm animals dotting the roundabouts stay mercifully in place, unlike the free roaming cattle outside. These are merely the fringe benefits of buying an accommodation in what could easily be called Pakistan’s most self-sufficient and luxurious gated community.


There is a riding range for those who have always felt congested city streets do not offer enough galloping room for horses. There is a golf course for those who have never been particularly fond of stirrups and there is a cinema with reclining sofas for those who don’t even like walking. There are health clubs, hospitals, playgrounds and even a cricket stadium in Phase 8, a phase bigger than the first six phases combined. So large, in fact, that it’s possible to take a wrong turn while traversing it and end up in New York somehow. For, beyond an avenue lined with palm trees, there is a Statue of Liberty looking just as confused about being there as you might be about seeing her. There is also an imitation Eiffel Tower on the other end of the same phase. Because, well, why not?----

While Bahria Town has expanded to other cities (the one in Lahore has been functional for a while and construction has started in Karachi and Nawabshah, and is expected to start soon in Hyderabad and Peshawar), the one next to Rawalpindi/Islamabad is still the oldest and most densely populated. It claims to be housing 100,000 people as of now.

Early residents remember it largely being a jungle even 10 years back. The visual trajectory from green to grey has been rapid; one week there would be four-legged creatures running around and the next week four-wheeled vehicles.

Realtors say they primarily deal with business people or retired civil and military officials. The former because they don’t need to hit a nine-to-five job in city centres — which can be a very long commute from Bahria Town; the latter because they get service benefits which they can use or sell to buy a house in this enclave. Selling a service allotment in Islamabad, for instance, will comfortably pay for a house in Bahria Town. Property is cheaper this far away from a city — which is the entire point.

Property dealers also say they run offices abroad; Bahria Town, too, has its corporate offices in the United States, the United Kingdom and the United Arab Emirates. Expatriate Pakistanis who have accumulated a certain amount of wealth, have gotten used to a certain standard of living and now wish to keep a house in their country of origin, are inevitably attracted to Bahria Town’s lavish infrastructure and the uninterrupted supply of electricity.

Riaz Haq said...

Gated communities of Pakistan by AFP


Published on Dec 10, 2013
Gated communities - offering secure living in a sometimes volatile country - are growing in popularity in Pakistan with some 100,000 people living in one of them near Rawalpindi. Duration: 02:07

https://www.youtube.com/watch?v=ZvKOCZuZAiM

Riaz Haq said...

Real Estate is a promising and growing sector of the Pakistani economy. Pakistan spends $5.2 billion on construction in a year and according to the Pakistan Bureau of Statistics, construction output accounts for 2% of GDP.

With the rate of urbanization that Pakistan has been experiencing, there is a growing need for urban planning. Pakistan is home to Asia's largest real estate investors Bahria Town.

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Former chairman and present consultant of Bahria Town, Malik Riaz Hussain has signed an agreement with His Highness Sheikh Nahyan bin Mubarak al Nahyan, Chairman Abu Dhabi Group, Union National Bank and United Bank Limited under which $45 billion will be invested in Pakistan.

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The top players in the real estate industry are undoubtedly the DHA and Bahria Town. The latter has played a pioneering role in commercializing the real estate development and establishing it as a formal sector. Now the real estate investments come under the tax net. Similarly, DHA is also a top notch housing society. It is well-engineered and has state-of-the-art infrastructure facilities such as schools, colleges, universities, hospitals, cinemas, parks, marriage lawns, clubs, security management and traffic control system etc. Furthermore, the earthquakes in Pakistan have brought to the attention of regulatory bodies and the end consumers the need for enforcement of building codes and quality construction practices. According to survey of some Pakistani property portals including lamudi.pk, Homespakistan.com and Pakistan real estate.net interviewed several buyers of residential homes and commercial buildings and confirms that they prefer quality designing rather than cheaper and casually designed units. Hence, this makes it a perfect case to invest in the booming real estate sector of Pakistan.

Real Estate Investment Trust

Investors piled into Pakistan’s first real-estate investment trust, which was launched this year with a public offer that was heavily over-subscribed, the REIT’s lead manager and analysts said on Thursday.

The Dolmen City REIT offered investors a 25% stake in a 22.24 billion rupee ($218.5 million) shopping mall and an office complex at Dolmen City, one of the most prominent real estate developments in Karachi, Pakistan’s largest city and its economic hub. The Arabian Sea-front project includes three other structures not included in the REIT.

Traders and the REIT’s main advisor said the initial offer for 75% of the trust to institutional investors and high net-worth individuals through book building on Monday and Tuesday drew demand of more than 7 billion rupees for an offering of shares worth 4.17 billion rupees at a floor price of 10 Pakistani rupees ($0.10). At the strike price, the initial offer raised 4.59 billion rupees, according to the REIT’s lead manager.

The remaining 25% of the stake was to be offered to the public on Friday at a strike price of 11 rupees ($0.11). Analysts and the REIT’s management expected the Friday offering to be fully subscribed as well, raising another 1.53 billion rupees.

“The interest rate is at a 42-year low, with the discount rate at 7%, so for people who invest in fixed-income instruments, REITs are attractive,” said Muhammad Tahir Saeed, deputy head of research at Topline Securities, a Karachi-based brokerage.



https://www.linkedin.com/pulse/real-estate-pakistan-spends-52-billion-construction-year-safwat-zaki

Riaz Haq said...

New UBL Tower Karachi is the new bank headquarter of United Bank Limited in Karachi, Pakistan. United Bank Limited (UBL) has just finished the construction of its head office in Karachi.

A 22 storey glass structure, 2 towers internally connected with 5 bridges? Wow. That's #UBLHeadOffice, a new #IconicLandmark in Karachi

According to UBL, this landmark represents the progressive and innovative past and the future of the bank. It is indeed a one of a kind high rise built by a banking company in Pakistan. The city’s skyline looks more lively with UBL’s new building towering over other commercial buildings in the area. https://propakistani.pk/2016/12/19/ubl-moved-headoffice-stunning-twin-skyline-karachi/

Riaz Haq said...

#China building boom to churn out #Pakistan's largest steel IPO with #steel output growing 23% in 2016. https://www.bloomberg.com/news/articles/2017-05-15/china-building-boom-to-churn-out-pakistan-s-largest-steel-ipo … via @markets

Agha Steel Industries Ltd. is planning Pakistan’s biggest-ever private sector initial share sale this year to help boost output as China funds more than $55 billion in infrastructure projects across the nation and a buoyant stock market spurs investor demand.

The Karachi-based company plans to raise as much as 10 billion rupees ($95 million) selling a 25 percent stake, Executive Director Hussain Agha said in an interview. The sale will be the largest since the 12-billion rupees government stake sale of Habib Bank Ltd. in 2007, the country’s largest IPO yet.

Steel and cement makers in Pakistan are expanding to meet demand as the “One Belt, One Road” trade route financed by China spurs construction. The nation’s economy has grown at about 5 percent annually since 2013, encouraging Agha’s peers including International Steels Ltd. and Aisha Steel Mills Ltd. to lift production.

“You need roads, sky rises and housing,” said Agha. “Pakistan’s steel industry is in an infancy stage and growing at a massive pace -- the whole environment will change.”

Read more: Chinese Largesse Lures Countries to Its Belt and Road Initiative

The company will use the funds for $50 million expansion that will triple output to 500,000 metric tons within two years. Production will then double to a million tons by 2023, he said. Habib Bank has been appointed financial adviser while Arif Habib Ltd. and BMA Capital Ltd. were picked as book runners for transaction.

Pakistan’s steel output grew 23 percent to 3.6 million tons in 2016, the biggest gain among 40 nations, according to the World Steel Association. Agha Steel expects construction-grade steel, such as rebars and wire rods, to grow as much as 12 percent annually for the next three years.

The construction sector expanded 13 percent in year ended June 2016, more than twice the pace in the previous 12 months, according to State Bank of Pakistan’s annual report. Rapid urbanization and rising income levels has left the nation with an annual shortfall of 500,000 homes, according to real-estate developer Arif Habib.

“Real-estate is the main engine for this growth, it has really picked up,” said Ayub Khuhro, chief investment officer of Karachi-based Faysal Asset Management Ltd., which has about 8 billion rupees in stocks and bonds. “The government is also willing to protect companies with anti-dumping measures.”

Riaz Haq said...

Cement Makers See China-Led Bonanza as Pakistan Spends Billions
by Faseeh Mangi , Kamran Haider , and Khalid Qayum
June 1, 2017, 2:30 PM PDT
https://www.bloomberg.com/news/articles/2017-06-01/cement-makers-see-china-led-bonanza-as-pakistan-spends-billions

Nation’s cement output to rise by half as most firms expand
China is financing more than $50 billion of Pakistan projects
In his air-conditioned office protected from the scorching heat and dust outside, S.M. Imran points at a white lined map pinned on his wall showing Power Cement Ltd.’s planned expansion at its plant in Pakistan’s arid southern Sindh province.

Power Cement is aiming to triple capacity, riding a wave of Chinese-financed infrastructure projects across Pakistan valued at more than $50 billion. It’s part of Chinese President Xi Jinping’s biggest gambit in his “One Belt, One Road” project to rebuild the ancient Silk Road, a trading route of ports, railways and highways snaking across mountains, deserts and disputed territory through Asia to Europe and Africa.

The anticipated demand has been a boon for Pakistan’s cement industry, which is expected to increase capacity by 56 percent to 70 million tons in five years, according to Karachi-based brokerage Alfalah Securities Ltd.

“We used to carry stocks, but not anymore,” said Imran, a project director and cement industry veteran who has been in the business for four decades. “This capacity will be required.”

Mega Projects

Cement-makers are betting Prime Minister Nawaz Sharif will ensure timely completion of much needed infrastructure projects ahead of next year’s election, which the premier is widely expected to contest for a second consecutive term.

With that in mind, the government has committed to a $9.6 billion expansion of the national roads network, such as the Karakoram highway -- the main trade route between China and Pakistan -- along with about $35 billion on energy projects and power plants to end daily blackouts.

Encouraged by the China-Pakistan Economic Corridor, or CPEC, Gharibwal Cement Ltd. is doubling capacity to more than 13,000 tons a day by August, according to company spokesman Rana Muhammad Ijaz, who said its existing plant is producing at its peak. Power Cement Ltd. is boosting its ability to churn out 10,700 tons a day, while Cherat Cement Co. announced plans to build a third unit days after completing a second, with a capacity of 7,100 tons a day.

Cement stocks have also outpaced the nation’s benchmark stock measure, with a group of 21 companies rising an average 47 percent in the past year, compared to the KSE100 Index’s 34 percent gain.

“The demand isn’t going down because of a boom in the construction sector,” Ijaz said. “Mega projects are being built and the CPEC is a key factor for this boom.”

Riaz Haq said...

#Karachi's "land mafia" killing exposes the dark underbelly of #Pakistan's real estate boom. https://www.bloomberg.com/news/articles/2017-09-10/-land-mafias-and-the-battle-for-pakistan-s-booming-real-estate … via @business

Perween Rahman was returning home one evening in March 2013 from her job as head of the Orangi Pilot Project, which for years has pushed land title claims for Karachi’s poor, when she was shot three times by a gunman on a motorcycle.

Rahman died as she was rushed to hospital by her friend and colleague Anwar Rashid. “He was a sharp shooter,” said Rashid, now 71 years old and white-haired, but still a director of the OPP, pointing to his throat and chest to indicate where Rahman was hit. “This is because of the land -- the police, the mafia, all involved.”

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“Public land has commonly been illegally regularized and sold,” Brussels-based conflict watchdog International Crisis Group said in a February report. “It has become the city’s most prized and contested commodity, with federal, provincial and local land-owning agencies, military cantonments, corporate entities and formal and informal developers competing to extract as much value as possible. Given the fiscal stakes, disputes are settled by bribery and political, bureaucratic and police patronage, and even deadly force.”


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Some 13 different government agencies are tasked with regulating laws and coordinating development, but slums have sprung up across the city with little regard for any of these.


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Karachi’s real estate in recent years has offered better returns than Dubai and London, according to tycoon Arif Habib, who is building a $2 billion gated estate in the Naya Nazimbad district, neighboring an area that used to be controlled by Taliban militants. One of his units said on Monday that it has filed an application with the government to buy an extra 900 acres to expand the project.

Habib also pioneered and listed Pakistan’s only real estate investment trust in 2015, offering a stake in one of Karachi’s most prominent malls and office towers. Developers including Habib and rival builders such as real estate baron Malik Riaz Hussain and the military’s property arms, are tapping into the price boom.

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Rahman’s family and associates suspect her work mapping Karachi’s poor districts and helping residents gain land titles put her in conflict with powerful criminal networks. The OPP mapped more than 1,000 settlements between 2006 and 2013, though that stopped after Rahman’s death and subsequent threats and attacks on the group’s staff.

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One example of heightened scrutiny is property mogul Hussain’s vast city-sized Bahria Town development about an hour’s drive from Karachi. Construction began in 2014 and, when completed, the enclave will boast a 36-hole golf course, theme parks, five-lane highways, Dubai-style fountains, and what it says will be the world’s third-largest mosque.

A 125 square yard house in Bahria Town that initially sold for 1.73 million rupees ($16,000) is now between 2.4 million rupees to 3.5 million rupees, said M. Akmal Khan Khattak, a marketing manager at real-estate agent Athar Associates. He’s been recommending the purchase to his clients.

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“They have provided security, they have provided electricity,” Tariq said, referring to Bahria Town. “People see their success and they will follow.”

Sindh province, of which Karachi is the capital, is now looking to computerize land records which may help curb corruption, Mohammad Zubair, governor of the province and a member of the federal ruling party, said in an interview in March. This was earlier done in Punjab, Pakistan’s most populous region that’s also governed by the same party.

“Of course the challenge will always remain,” Zubair said when asked about land grabbing. “Because the political players and people in important positions are involved.”

Riaz Haq said...

#Pakistan #cement capacity reaches 47 million tons. Utilization at 87% with shipments at 41 million tons. #CPEC

http://nation.com.pk/business/11-Sep-2017/cement-industry-s-despatch-capacity-rises-to-47m-tons

The capacity utilisation of the cement industry was high at 86.46 percent in July 2017, while the annual cement despatch capacity of the industry has increased to 46.94 million tons.

Local dispatches from units based in northern region of the country were 2.423 million tons while their export despatches were 0.338 million tons in July 2017 as opposed to 1.516 million tons local and 0.306 million tons export despatches in July 2016. The turnaround after a dismal performance in June 2017 took the industry by surprise and the sharp increase in despatches in July 2017 revived hopes for the sector. The despatches were achieved despite political turmoil in the country and unprecedented rains throughout the country which depicts the maturity of the construction sector of the country. South based mills also recorded a growth in local despatches which increased from 0.352 million tons in July 2016 to 0.483 million tons in July 2017; whereas, exports took a hit going down to 0.138 million tons from 0.159 million tons in July 2016. A spokesman of All Pakistan Cement Manufacturers’ Association said that the despatch figures for July are most encouraging. However, he said that this does not mean that the economic planners ignore the genuine difficulties faced by this sector.

He said the industry is performing in stiff regulatory environment and is only surviving because it has upgraded its technology that has provided it the strength to take any challenge head on.

Riaz Haq said...

Why it's a good time to invest in #Pakistan's real estate. #realestate #property #Investment

https://www.khaleejtimes.com/business/real-estate/why-its-a-good-time-to-invest-in-pakistans-real-estate

Factors such as federal budget, law amendments and introduction of real estate investment trust have influenced sector's advancement
akistan's real estate industry continues to evolve as companies try to resolve real estate complexities in order to increase its growth, experts have revealed.

Factors such as the federal budget, law amendments and the introduction of the real estate investment trust have influenced the advancement of the industry. According to reports, investors have pulled out money from several banks in Pakistan after the introduction of 0.3 to 0.6 per cent withholding tax on filers and non-filers on tax returns.

These components, along with the rise of safe property investment bets in various parts of the country and abroad, encourage Pakistanis and non-resident Pakistanis (NRPs) to invest in valuable long-term investments compared to short-term purchases.

Showcasing the change in the industry, this year's International Real Estate and Investment Show brings the third Pakistan Property Exhibition in Abu Dhabi. The specialised event, held with the support of the Pakistan Embassy, Pakistan Business Council and Pakistan Association Dubai, showcases the country's leading developers and realty agents under one roof to showcase the best options for investment, provide spot sales and learn about the leading insights into the market. Visitors can expect to see properties from cities including Islamabad, Lahore, Karachi, Gwadar, Gujranwala and many more.

"Studies have continuously shown new global trends that the real estate market in Pakistan is tapping into. Apart from new demographic movements, Pakistan has also witnessed a heavy intercity migration over the last five years due to security and economic benefits that specific cities offer," said Antoine Georges, managing director of Dome Exhibitions. "The International Real Estate Exhibition Show enables Pakistanis to secure homes and investment properties in their country by bringing the opportunities to them through the Pakistan Property Exhibition. The pavilion aims to attract more than 10,000 Pakistani investors from the UAE."

To be held at the Abu Dhabi National Exhibition Centre from November 2-4, the exhibition enables Pakistan's realty giants such as DHA, Model Housing Lahore, New Lahore City and Bahria Town to showcase the latest properties available for aspiring buyers.

Real estate and investment companies will also have the chance to market their products to Pakistani investors through well-tailored marketing strategies made available by marketers such as Athar Marketing, Star Marketing, Midas Group and Q&A Marketing and more.

Riaz Haq said...

THE EXPRESS TRIBUNE > BUSINESS
Pakistan’s construction industry – the hot cake for foreign investors

By Tehreem HusainPublished: October 23, 2017

https://tribune.com.pk/story/1538687/2-infrastructure-building-pakistans-construction-industry-hot-cake-foreign-investors/

The construction industry is playing an important role in economic growth of Pakistan. Recent (provisional) estimates published in the Economic Survey of Pakistan show that the industry grew 9.1% in FY17 and contributed 2.7% to the country’s gross domestic product (GDP).

BMI Research has also provided a healthy growth outlook for the sector, putting it at 11.8% annually from 2016-20 and 9.1% over 2016-25.

The signing of the China-Pakistan Economic Corridor (CPEC) agreement and improvement in the country’s security situation have been the key to giving boost to not only the construction industry, but Pakistan’s image abroad. With China having the first-mover advantage in injecting foreign investment into the country, other countries have followed suit.

The sector has also been an important recipient of foreign direct investment (FDI). This can be judged from the latest figures provided by the State Bank of Pakistan, which show that the construction industry received a net inflow of $35.7 million in August 2017.

How attractive the industry is perceived to be for foreign investors can be gauged from the fact that in the current fiscal year from July-August FY18 the industry has received $55.7 million relative to $1.6 million in the same period of last year.

Locally, investment has also been boosted by government policies such as reduction in duties and taxes on building materials like steel, construction machinery and equipment and computerisation of land ownership records.



Riaz Haq said...

THE EXPRESS TRIBUNE > BUSINESS
Construction sector records impressive 9% expansion

https://tribune.com.pk/story/1419502/construction-sector-records-impressive-9-expansion/

The construction sector has once again posted a strong growth of 9% in the outgoing year, lower than the 14.6% increase in 2016, but much higher than the average growth of the past five years, according to the Pakistan Economic Survey 2016-2017.

Excluding the exceptional growth of 2016 and 2017, the average growth in the construction sector up to 2015, since FY12, was just 4%. Construction industry officials believe the recent growth is encouraging for the industry as well as the country because this will create new jobs.

According to government estimates, construction-related activities will gain further momentum on the back of increased public sector development spending coupled with infrastructure and power sector development projects under the China-Pakistan Economic Corridor. The construction sector contributes 2.4% to Gross Domestic Product, according to government assessments.
The robust construction activities also led to an increase in demand for steel and allied products, according to the survey.

“Cement growth derived from robust domestic demand, which allowed manufacturers to enhance their capacity utilisation. The outlook is encouraging on account of firm demand due to flourishing housing schemes and rising development spending along with anticipated CPEC-related projects,” it added.

Govt may withdraw special income tax

Despite extraordinary growth, the government is upset as it did not achieve its tax collection target from the sector in the outgoing fiscal year. “It is true that we could not collect the targeted amount from the real estate sector in this year,” said Finance Minister Ishaq Dar on Thursday.

However, he said that tax collection increased after the implementation of the new property valuation methodology by the Federal Board of Revenue in 2016.

Dar also said that construction industry officials requested the government to gradually implement the new tax regime, otherwise it could hurt the current high growth of the industry. Revenues from the construction sector dipped to a meagre Rs112 million in the outgoing fiscal year against conservative official annual estimates of Rs8 billion.

The representatives of builders and developers committed to tax authorities that the industry would pay up to Rs28 billion in income taxes under the new final tax regime, which was implemented in mid-2016.