Pakistani cement sector is one of the most important components of the Pakistan stock market.It also plays an important role in driving growth in the economy. It played an important role in the growth of the Pakistan stock market in last one year.Market experts are really hopeful about the future prospects of this sector.Pakistan government has devised a very effective strategy to increase cement exports to countries like China,UAE and South Africa.Investors are advising stock traders to invest in this sector to reap benefits from their investments. Following are the five most important reasons for investing this sector.
Expected $ 1 Billion Investment
Pakistani cement sector is expecting a investment of approximately $ 1 billion in next three years.These investments will be made by the different cement manufacturing companies of the country.Cement manufacturing companies like Cherat cement,DG Khan cement,lucky cement and Attock cement are four most important companies planning to invest in the Cement sector.These companies will invest in different construction related projects.These projects include projects like Pakistan-china economic corridor and housing related projects.
Cement sector growth
Pakistan is the sixth most populous country in the world.Its housing and cement sector has a very good growth potential.The local per capita cement consumption is 140 kgs as compared to the global per capita consumption of 400 kgs .This low per capita consumption is mainly due to lack of government interest and high real estate prices in the country.The figure given below shows the consistent growth of cement sector in the last five years.
Investors and market experts believe that 2016 will be a growth year for the cement sector and also for its shares trading at Pakistan stock market.They are expecting that Pakistani cement sector will grow with 3.5 % annual rate in the year 2016.Its sales are expected to reach 36.7 million tons at the end of the year 2016.Its sales are projected to grow with 11.4 % annual rate.
Cement sector Performance in Pakistan Stock Market
Cement sector has really performed well at the Pakistan stock market in last six months.The share prices of its top companies such as attock cement,DG Khan cement,cherat cement and Luck cement have really showed positive growth in these six months.The share prices of the Lucky Cement,Attock cement,Cherat Cement and D.G Khan Cement grew by 2.94 %,28.32 %,29.24 % and 24.73 % respectively during the last six months.
China Pakistan Economic Corridor
China Pakistan Economic Corridor (CPEC) is a very big reason for the renewed excitement of the investors about Pakistani cement sector.These investors believe that CPEC project will prove to be a major game changer for the Pakistani economy and also for its cement sector.It will also help the sector to provide hundreds of jobs to the country’s unemployed workforce. It will also bring great dividends for investors interested in cement stocks trading at Pakistan stock market. CPEC will bring $ 46 billion Chinese investment into Pakistani economy.
Cement demand is expected to rise as this project involves large number of housing and infrastructure development projects for the country. CPEC also consists of development projects related to other important industries such as transport,railway,energy and power.These projects will certainly improve the overall economic landscape of the country in a very effective way.