Essay About Analysis Of Power Cement And Sectors Cement Industry

Analysis of Power Cement – Competitive Anaysis of Cement Industry
Lahore School of EconomicsFINANCIAL STATEMENT ANALYSISPOWER CEMENTSubmitted by:Wardah Khan15P00021Submitted to:Dr. Kumail RizviSemester:Summer’ 16Date:30th August, 2016.POWER CEMENTCOMPETITIVE ANAYSIS OF CEMENT INDUSTRYCement industry is one of the key industry that plays a vital role in the development of Pakistan’s economy. It went through different stages of nationalization and privatization. It is spread on the northern and southern zone of Pakistan. As compared to other sectors cement industry is operated in the areas which have special infrastructure and favorable locations. This is the reason majority of the market share of cement industry is operated in the northern parts of the country. In Pakistan the major portion of cement usage is in the construction of buildings. The competition in cement industry is limited to the regional zones as it is not easy to transport cement to different locations. The Bestway cement and lucky cement are two major market share holders in this sector and are located in the northern zone. However lucky cement caters to the southern part as well. The expansion in this sector is not very easy, there are some barriers for the new entrants like limited supply of raw material, costly setup of new cement plants that does not make it easy to enter the market. There is a lot of pressure on some manufacturers to be cost efficient as they are running their business on the small scale unlike some big plants like lucky cement. The competition is based on the raw materials and price setting in small scale companies. The major chunk of the cement market is controlled by the Bestway, Lucky cement, and Maple leaf cement as they are the strong market share holders of this sector. There are generally no substitute of cement, some companies use timber but that is usable only for small buildings. It is not suitable for big building which use steel along with the protection of cement to cover it and give it support. Overall the government is in favor of this sector as it plays a key role in the development of the country’s infrastructure, new venture capital and growing economy.POWER CEMENT ANALYSISPower cement is located in the south region with a market share of 2%. It does not hold much share as compared to other main stream companies in this region like lucky cement which caters both in the south and north region. Power cement’s income is at a constant increase as well as its earnings per share. So the company is constantly growing.Rivalry Among Existing Competitors:Thatta cement having a share of 1% and Attock cement having share of 4% are considered to be its competitors. Although Attock cement is running at a bit big scale than the power cement but keeping in view the growth capacity of power cement it can overcome this company. Price regulation also creates competition among cement companies. Power cement’s selling price is assumed to be Rs 380 per bag whereas attock offers 500 per bag. Power cement has a chance to increase its sales by the making more customers in the south region by participating in more projects.