Karachi: The cement sector recorded a downturn in June 2024, with dispatches falling to 3.55 million tons, marking a 13% year-over-year and a 17% month-over-month decrease. This contributed to an annual tally of 45.29 million tons for FY24, which, despite being an 8-year low for local dispatches, reflected a marginal 2% increase from the previous year due to a significant boost from exports.

According to JS Global, the sector's performance was heavily influenced by a 56% surge in export volumes, which compensated for the 5% decline in local dispatches during the fiscal year. However, this increase in exports did not lead to proportional profit gains due to higher transportation costs and competitive pricing pressures in international markets. Recent tax hikes for exporters are also expected to further impact profit margins negatively. Despite these challenges, JS Global maintains a positive outlook for the cement sector, projecting potential margin gains from cost efficiencies in FY25. Additionally, the recent monetary easing by the State Bank of Pakistan, including a 1.5% cut in the policy rate to 20.5%, could benefit companies like Fauji Cement and Maple Leaf Cement, which have undertaken timely expansions.