PAFL acquires Hazara Phosphate Fertilizers Limited.Pak American Fertilizers Limited, a 100% owned subsidiary of the Company, successfully completed the acquisition of Hazara Phosphate Fertilizers (Pvt.) Limited from the Government of Pakistan as part of its ongoing privatization initiative. Now the Company (through its subsidiaries) owns and operates the country's newest and most efficient urea plant, Pak American Fertilizers Limited, and also the largest Single Super Phosphate (SSP) manufacturing plant in the country, Hazara Phosphate Fertilizers (Pvt.) Limited. This Completes the Company's vitally important strategic goal to become a diversified manufacturer producing both nitrogenous and phosphatic fertilizers. Urea prices would increase by Rs. 85/bag to Rs. 605/bag DAP prices would decline by Rs. 275/bag to Rs. 825/bag The domestic usage ratio of DAP to urea is 1:5 (20%: 80%) as against agronomic recommendation of 1:2 (33.3%: 66.7%). The present domestic usage ratio of DAP and urea is adversely affecting the productivity of the arable land which would hamper the agricultural production of the country going forward. In our view, this proposal of ECC is the need of the hour otherwise the country would have to face severe consequences in years to come. The measure EEC took would be more focused towards provoking the demand for DAP, keeping per acre cost constant and expected to increase the crop yield by 10-15%. Lower urea imports would not hurt the earnings of the domestic fertilizer manufacturers. FFBL, being a sole producer of DAP accounts for 32% market share of DAP, rest of DAP is imported by other fertilizer manufacturers. FFBL would be benefited in the longterm owing to capacity enhancement of its DAP plant which is expected to come online by the end of FY'07. This would increase the total DAP production capacity of the company by 51% to 2046tons per day.
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Pak American Fertilizers Limited, a100% owned subsidiary of the Company,successfully completed the acquisition ofHazara Phosphate Fertilizers (Pvt.)Limited from the Government of Pakistanas part of its ongoing privatizationinitiative. Now the Company (through itssubsidiaries) owns and operates thecountry's newest and most efficient ureaplant, Pak American Fertilizers Limited,and also the largest Single SuperPhosphate (SSP) manufacturing plant inthe country, Hazara PhosphateFertilizers (Pvt.) Limited. This Completesthe Company's vitally important strategicgoal to become a diversifiedmanufacturer producing bothnitrogenous and phosphatic fertilizers.
Urea prices would increase by Rs.
85/bag to Rs. 605/bagDAP prices would decline by Rs.
275/bag to Rs. 825/bag
The domestic usage ratio of DAP tourea is 1:5 (20%: 80%) as againstagronomic recommendation of 1:2(33.3%: 66.7%). The present domesticusage ratio of DAP and urea isadversely affecting the productivity ofthe arable land which would hamper the
agricultural production of the countrygoing forward. In our view, this proposalof ECC is the need of the hourotherwise the country would have toface severe consequences in years tocome.
The measure EEC took would be more
focused towards provoking the demandfor DAP, keeping per acre cost constantand expected to increase the crop yieldby 10-15%.
Lower urea imports would not hurt theearnings of the domestic fertilizermanufacturers. FFBL, being a soleproducer of DAP accounts for 32%market share of DAP, rest of DAP isimported by other fertilizer
manufacturers. FFBL would bebenefited in the longterm owing tocapacity enhancement of its DAP plantwhich is expected to come online by theend of FY'07. This would increase thetotal DAP production capacity of thecompany by 51% to 2046tons per day.
PAFL has had multiple achievements inthe last few months. It achieved aSuccessful turn around for maintenance
purposes in less than fifteen days.
Since Acquisition of the plant by Azgard9, PAFL has managed to acquire 8 % ofmarket share within 9 months. Thissuccessful penetration of the marketresulted in a collection of Rs. 3.0 billionas revenue.
In the midst of all this activity asuccessful Brand Launching was
accomplished. The New Brand by thename of “ TARA ” was successfullymanaged to create a place for itself
in the market with the help of differentDealer and Consumer IncentiveSchemes.
Along with this successful diversificationof the Product categories was achievedwith the purchase of 30000 Tons of
DAP in a scenario of internationalshortage and this vessel is arriving inJune 2007. Moreover, PAFL have alsobrokered a deal for another fertilizerproduct namely MOP which is expectedto arrive in Jul 2007.
Dealer network was increased at adrastic pace from none at the time ofacquisition to 250 dealers at this point intime and still expanding.
At the same time the ProductionEfficiency was increased to 108 % fromthe earlier 100 % production level.Alongside this various cost reductionmeasures have been taken to makePAFL a more financially efficientorganization.
The plant is going through various re-engineering processes to enhance itsefficiency and output. According to thevarious plans 15 % enhancement in ureaproduction capacity will be achieved byDec 2007 and a further 35% increase will
Simultaneously 350 tons increase inproduction in the ammonia plant will beaccomplished by Dec 2008.
Sales and Marketing department wasdeveloped with presence in each keymarket.
Process and system for port logistics arenow in place with an independentresource handling the importedfertilizers.
Quality improvement activities are in process through various conventional andunconventional methods. Simultaneously PAFL has adopted the attitude ofconstantreevaluation of the market and intends to follow a policy of constantResearch & Development in the various stages involved in fertilizer production andmarketing and to achieve a competitive edge in the market.
Various steps are being
introduced in the PAFL plant
to enhance the product Quality
along with the increased
quantity. Various mechanical
and chemical changes are
being introduced to enhance
the product quality.
Through rigorous marketresearch and with the right
Since Acquisition Production Efficiencyhas been increased from 100 % to anastonishing 108 % and steps are beingtaken to take it even further.
As a result of this we are nowsuccessfully producing1120 MT fromanearlier 1050 MT Plans have beengenerated to increase the productionfurther with the help of plant re-engineering / revamping.
Since the acquisition PAFL has sold300,000 tons during the period Jul 16,2006 to May 31, 2007.
a lean and efficient system. Thepresent number of employees totals to792 people inclusive of managementand technical staff. The employees areworking as a well knitted team with
targets to be the best in the industry.
PAFL with its policy of being a socially responsible