of Rs739 million in 2017, to just Rs22 million in 2018, to two consecutive losses in 2019 and 2020. At least from that perspective, the company has managed to do quite well. The improvement represents a shift on the part of Exide to revamp itself following poor showing in the last few years. First, some context on Exide Pakistan. The company was incorporated in 1953 as a private limited company, in association with Chloride Group, of the United Kingdom (that particular group had associates in 35 countries globally). In 1982, it was listed on the Karachi Stock Exchange, now known as the Pakistan Stock Exchange. The company essentially manufactures and sells batteries, chemicals and acid, and also supplies solar energy solutions. Most of its facilities for both batteries and chemicals are located in S.I.T.E Karachi and Bin Qasim Karachi. Today, Exide claims that it is the largest manufacturer of lead acid electric storage batteries in Pakistan. Its clients include car companies such as Suzuki, Toyota, Honda, Mercedes-Benz, and Audi. Though the company is publicly listed, at least 75% of all shares are held by the director (Arif Hashwani), CEO and children, which is mainly the Hashwani family. In fact, Sana Hashwani (his wife) holds nearly 21% of all shares. Only 8% of shares are held by the general public. Now, for the most part, the company has managed to do well. Between 1998 and 2007, the company has grown at a piecemeal rate, before jumping spectacularly post-2008. Between 2009 and 2015, net sales rose from Rs5,630 million to Rs13,138 million. Between 2015 and 2018, net sales hovered in that general ballpark, before dropping to Rs 9,507 million in 2019, and then again to Rs8,722 million in 2020. How come? According to the company’s annual report, a “highly disappointing auto sector” led to car sales plunging by 55% to 94,325 units from 209,255 units sold last year. Similarly, the sales of trucks and buses plummeted by 50% to 3,477 units, jeeps sales fell by 50% to 3,564 units and so on. “Demand for automobiles, especially cars,
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But coming out of Covid-19, consumer demand has actually jumped, now that the worst of the pandemic is over. For instance, according to the State Bank of Pakistan, automobile loans increased from Rs251 billion in March 2020, to Rs270 billion by October 2020, depicting an increase of 8% had plunged sharply due to steep rise in prices contributed by imposition of various taxes in the budget 2019-20, rupee devaluation and soaring interest rates. This unprecedented rise kept the prospective buyers at the sidelines as the prices went out of their budgets,” explained the Exide director’s report of 2020. This is how the company recorded a loss for the first time in the last decade in both 2019 (Rs504 million) and 2020 (Rs559 million). Now, that is how things used to stand. But coming out of Covid-19, consumer demand has actually jumped, now that the worst of the pandemic is over. For instance, according to the State Bank of Pakistan, automobile loans increased from Rs251 billion in March 2020, to Rs270 billion by October 2020, depicting an
increase of 8%. Its a a view echoed by the last quarterly report, ending in December 2020: “The entire auto sector except heavy commercial vehicles gave a brisk performance during the first half of the current year on account of low interest rates and better farm income” According to Exide, car sales jumped by 13.4%, SUVs to 134%, light commercial vehicles by 32.4%, farm tractors by 43%, and two to three wheelers by 6.3%. That jump in car sales helped the company shoulder on. That is how even in the third quarter ending December 30, net sales stood at Rs3.3 billion, compared to Rs1.8 billion in the same period last year. And it seems that the company has only just capitalized on that momentum. n
Cement does well - again
The construction sector’s lobbying went a long way in the cement industry keeping its head up
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ame an industry, and it probably took a hit under the Covid-19 pandemic. Automobiles? Collapsed. Textiles? Already had one foot in the grave but crum-
bled entirely. And let’s not even consider how oil did. But there is one industry that has done well consistently. Cement. It was told well ahead of time of the shutdowns to take place in April, had time to prepare, and survived the onslaught of
