Cherat is taking out a long term loan to start its fourth line, in light of rising demand for the bags
Pakistan’s cement sector is doing well – really well. Just last November, the sector posted a profit after four consecutive quarters of losses. Part of this has to do with the uptick in demand for cement: the federal government announced a construction package in April 2020, in an effort to boost the sector.
For instance, investors will be granted a waiver of up to 90% on tax, if they are investing in construction projects under the Naya Pakistan Housing Scheme. The industry will also have a fixed tax regime, instead of taxes on profits. Commercial banks were also told to allocate 5% of their total lending to the construction sector (banks’ current exposure to the sector is only at 1% of overall advances).
All of the above means more cement. But it also means someone needs to produce more bags to carry that cement.
Source : Profit