DG Khan Cement maintains its progress

Nishat Group-owned DG Khan Cement (DGKC) is progressing well due to the back-up of dividends from group companies. According to Spectrum Securities Ltd, the portfolio/revenue of DG Khan is promising, given its holding company portfolio with major holdings in banks, textiles, power generation, agriculture, hotels and dairy.

However, the company borrowed a massive loan to finance capacity expansion. Working capital requirements at the end of March 2023 stood at PKR42bn (US$146.6m). The likely ease in policy rate on slowing the pace of inflation and resuming economic activities will reduce the company’s financial cost in years to come.

In 2022 DGKC secured an order from the USA to supply 600,000t of high-quality low-alkali cement, expected to bring home a total of US$360m. Moving forward, the first consignment of 50,000t of cement was sent in June 2022, followed by the second consignment of 37,500t in January 2023, and the third consignment in February 2023.

DGKC is amongst the largest cement manufacturers in Pakistan with a production capacity of 25,000tpd or 7.5Mta of cement. The company operates three cement plants at Dera Ghazi Khan, Kalar Kahar and Hub. In March 2023 it completed the installation of the on-grid solar power plant of 6.952MW at its Khairpur site, financed 100 per cent by the State Bank of Pakistan.