Fauji Cement Co solar facilities could yield annual savings of PKR2.1bn
BMA Research has focussed on and discussed how Fauji Cement Co Ltd (FCCL) will progress and reap the benefits of various measures to improve profitability. The research house believes that FCC saw an enhanced focus on its production efficiencies through green technologies. After its recent installation, the company enhanced its solar production capacity to 40MW. With the potential to generate 60GWh annually, the solar facilities could yield annual savings of PKR2.1bn (US$7.63m).
In tandem with its installed 48MW waste heat recovery (WHR) plant, FCCL fulfils 50 per cent of its electricity requirements through cheaper energy sources.
Coal uses
Since the surge in global coal prices, FCCL has leaned on Afghan and local coal for its kiln fuel needs. During FY22-23, local coal constituted 53 per cent of the company’s kiln fuel, while the remainder was fulfilled by imports from Afghanistan. BMA Research estimates that the increased use of local coal has enabled the company to yield production savings of around PKR600t (PKR30/bag). Moreover, the company is also utilising alternative fuel sources, including tyres and poultry waste, to further insulate itself from rising energy costs.
New expansions will allow market share growth
FCCL’s expansion at its DG Khan site, scheduled for commissioning in the 2QFY23-24, will enhance the company’s production capacity to 10.5Mta, cementing itself as the third-largest cement producer in the country. FCCL is in the process of setting up a cement manufacturing plant with a production capacity of 2.05Mta. For this purpose, the company has agreed with Hefei Cement Research & Design Institute Corporation Ltd of China for offshore equipment supply and Sinoma Handan Engineering Co Pvt Ltd of China for construction-related services.
Annual report releases
In the FY22-23 FCCL demonstrated a strong financial performance, attaining a profit after tax of PKR7.4bn compared to last year’s PKR7.1bn. This is despite the retrospective imposition of Super Tax having the impact of PKR1.9bn, stated by CEO/MD FCCL Qamar Haris Manzoor. The company’s cement dispatches during FY22-23 were recorded at 4.8Mt.
