Shabbir Tiles plans Rs1.25 billion investment for expansion

KARACHI: Shabbir Tiles and Ceramics, a country’s leading tiles manufacturer, earmarked Rs1.25 billion in investment to upgrade and expand its manufacturing facilities, the company’s official said on Friday.

Masood Jaffery, chief executive officer of Shabbir Tiles said barriers such as regulatory duty and anti-dumping duty provided a breathing space to the local ceramics industry.

In the past, Jaffery said imports of inferior quality and cheap tiles from China coupled with smuggled goods from Iran had adversely impacted the ceramics manufacturers.

“Shabbir Tiles as well as other market players had been incurring losses for the past five years as the cheap Chinese products were eating our market share and so there was no investment in the ceramics industry despite abundant demand,” he said.

But, the Karachi-based company, a subsidiary of House of Habib Group, has been on course to profits since the government placed an anti-dumping duty on Chinese tiles in October 2017, which followed regulatory duty on a long list of importable products including tiles.

The company’s executive said demand of building materials particularly tiles is growing and the company is investing in expansion and up-gradation to tap the market.

“We are launching a high quality product, which is none lesser than the European tiles available in the market at a much higher rate,” he added.

The first phase of the balancing and modernisation activities of plant and machineries is complete, while the second phase is on track which after completion will support product development and accommodate changing customs preferences.

Pakistani industrialists fear China’s ever-growing influence will put them out of business. Before the duty was imposed, tile imports from China had more than doubled in the past five years making up around 50 percent of the industry.

The company is optimistic on progress with ongoing activities in construction sector. It said the industry requires immense backing of the government for reduction in high energy and other input costs and also to make imported tiles equally competitive with locally manufactured tiles.

Shabbir Tiles posted a profit of Rs11.11 million for the half-year ended December 31, 2017 compared with the loss of Rs104.11 million for the period ended December 31, 2016. The scrip was trading at Rs15.35/share on Pakistan Stock Exchange on Friday.