Lucky Cement Limited has started its new plant at Karachi with a production capacity of 4000 tons per day, making it the single largest cement manufacturing company in Pakistan, Executive Director Mr AR Thaplawala, said in a press statement Monday. The new plant is located on the Super Highway near Karachi. He said that the company had already started despatches from the plant.
Lucky’s executive director further said that within the next 8 to 10 days, the company would rolling out cement bags from another plant at Pezu in Bannu division with a capacity of 4000 tons per day. He said that a second plant at Karachi would come on line from early next month.
Cement sector analysts observe that the company is following the largest expansion plan with setting up two new production lines of 2.5 million tons capacity each in Bannu division and on Super Highway near Karachi. These expansions would increase the company’s total production capacity to 6.55Mta from the current capacity of 2.77Mta.
Interestingly, DG Khan Cement Company Limited, which until now had remained the largest cement producer in Pakistan, has stepped back to the second place. But the "war on size" is far from over as DG Khan has already announced its plans for another expansion of 10,000 tons per day.
Capacity expansions by several other cement companies such as that of Fauji are also underway. Lucky’s management, however, contends that the company would enjoy the benefits of low expansion cost per ton, Rs 2,579 (US$42), and the "first mover advantage."