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Paper and board industry in Pakistan.

* Production of paper and board increased from 80,920 tons in 1984 to 169,228 tons in 1990 showing more than 100 per cent rise in six years.

* In the last three years the paper industry has shown improvement. This is evident from the capacity utilisation which was 63 per cent in 1988-89 increased to 70 per cent in 1990-91.

* At present Karachi Stock Exchange has 13 companies in the paper and board section with total paid-up capital of Rs. 743.60 million.

According to Pakistan Pulp Paper & Board Makers Association there were 23 paper units who were its members. Production of these units increased from 80,920 tons in 1984 to 169,228 tons in 1990 showing more than 100 per cent rise in six years. The production in different categories was: writing and printing paper 33 per cent packing and other 20 per cent paper board and 26 chip board 21 per cent.

In the last three years capacity utilisation in the paper industry has shown improvement. This is evident from the capacity utilisation which was 63 per cent in 1988-89 increased to 70 per cent in 1990-91.

Pakistan Paper Corporation has been closed down. However, new units have come up and these units are supplying writing and printing paper to the domestic market. Production of writing paper was estimated at 56,365 tons in 1990 as compared to 31,709 tons in 1984 showing a rise of 77.7 per cent in the last six years. Production of paper board was estimated at 45,627 tons in 1990 as compared to 30,391 tons in 1984 showing a rise of about 50 per cent during the same period. Production of wrapping and packing paper registered a rise of 316 per cent during the same period up from 8079 tons in 1984 to 33618 tons in 1990.

Paper & Board Companies

on Karachi Stock Exchange

At present Karachi Stock Exchange has 13 companies in the paper and board section with total paid-up capital of Rs. 743.60 million. Sales and pretax profits of these companies are given in table on the next page. It will be seen that 4 companies are in the red, white others have satisfactorily improved their performance.

Adamjee Paper Mills has been sustaining losses and the accumulated loss as on June 30, 1990 stood at Rs. 122.058 million exceeding the paid-up capital of Rs. 41.823 million.

Amongst the other unfavourable factors the following may be recounted:-

a) Power Supply - load shedding for 4 to 5.

hours every day for months at a stretch,

besides unannounced shut downs. A

new factor that has come up is the

fluctuations in the power supply. There

were also unfortunately a series of major

breakdowns of the WAPDA stations

plunging huge areas into complete

darkness. The average loss of

production due to this factor was for a

period of hours.

b) Waste Paper - unexpected short supply

of waste paper and local chemicals

were also experienced during the year

on various occasions, which led to the

curtailment of production.

c) Unsatisfactory labour situation

adversely affected the output of our

workers, besides the loss of production

for a period of approximately 200 hours.

d) High depreciation and financial cost on

BMR assets could not be absorbed as

the desired production level has not as

yet been achieved.

e) Increase number of National Holidays

resulting in 20 day's lost production.

Asia Board Industries Ltd. has also been sustaining losses and accumulated loss stood at Rs. 44.77 million as on 31.12.90. The reasons for this erratic performance were the same as mentioned relating to Adamjee Paper. Century Paper and Board Mills is an integrated and fully balanced pulp, paper and board mills with capacity to manufacture 100 to 120 tons per day. The first year was a partial year of company's operations and consequently lower production and sales volume.

It may be mentioned that the low grammage poster paper has been produced for the first time in Pakistan by Century. The company has also installed coating plant which can produce Coated Duplex Board demands of which was made through imports. The plant is operating at 75 per cent rated capacity.

Packages has installed a new Power Plant having a capacity of 10 MW. The company has begun a major balancing, modernisation and replacement programme at a value of Rs. 700 million. The major part of the programme is expected to be completed shortly. The paper and board production activity operated at 103 per cent of rated capacity while the conversion activity operated at 99 per cent of rated capacity during 1990. Security Paper during the year 1990 produced 1288 tonnes of good paper which was the highest level of production in the history of the company and increase of 11 tonnes over the previous year's output of 1277 tonnes.
 TABLE - I
 Capacity Utilisation
 Capacity
Year Production Utilisation %
1988-89 156,101 63
1989-90 159,798 66
1990-91 169,228 70
 TABLE - II
 Production of Paper & Board
 (Quantity M. Tons)
 Writing & Packing Paper Chip
Year Total Printing Other Board Board
1980 79,591 28,226 12,120 27,315 11,930
1981 84,719 33,122 11,867 28,597 11,930
1982 86,317 32,975 14,579 28,657 10,106
1983 80,249 29,592 10,649 29,568 10,440
1984 80,920 31,079 8,079 30,391 10,741
1985 109,544 35,477 22,618 36,445 15,004
1986 121,578 32,827 23,105 36,676 28,970
1987 146,133 40,095 30,644 43,405 31,989
1988 156,101 55,511 24,026 45,170 31,394
1989 159,798 55,524 30,742 42,505 31,327
1990 169,228 56,365 33,618 45,627 33,618
Source: Pakistan Pulp Paper & Board Makers Association
 TABLE - IV
 Sales and Pretax Profit of Paper and Board Companies
 (Rs. in million)
 SALES PRETAX PROFIT
Name 1990 1989 1990 1989
Adamjee 230.10 240.88 - 18.45 - 46.00
Asia Board 26.30 18.84 - 8.41 - 9.97
Balochistan
 Particle Board 104.09 84.56 9.01 6.62
Crescent Board 323.55 256.36 11.67 11.47
Century 177.62 - - 5.38 -
Merit Packaging 92.93 105.68 6.40 4.68
Orient Straw 26.11 27.47 - 0.24 0.12
Pakistan Paper
 Prods. 23.29 23.24 2.63 2.63
Packages 1,316.02 1,071.45 197.66 115.62
Pakistan Papersack 598.17 552.77 33.35 34.95
Security Papers 101.51 100.58 18.40 17.61
Source: Company's Balance Sheet
 TABLE - V
 Capacity Utilisation Percentage
Name 1988-89 1989-90 1990-91
Adamjee 62 52 49
Chilya 65 35 30
Dadabhoy 230 243 260
Flying Paper 95 100 93
Orient 136 135 141
Packages 100 103 92
Mandiali 108 106 84
Premier 83 84 59
Qadria 89 80 90
Sampak 99 109 100
Sayid 232 234 229
Star 54 62 64
Pak. Paper Corp. 36 7 -
Security 96 97 95
Al-Quresh 70 57 31
City 36 33 75
Century - 7 42
Ali Paper 99 80 97
Flying Board - 11 65
Kabir 77 89 105
Bahawalpur 30 - -
Source: Pakistan Pulp Paper
& Broad Makers Association Karachi
 Earning per Share of
 Paper & Board Companies
 (Earnin gper Rs. 10)
 1990
Security Paper 6.06
Packages 5.82
Pakistan Papersack 4.68
Balochistan Particle 3.76
Pakistan Paper Prod. 3.39
Merit Packaging 1.77
Crescent Baord 1.12
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Publication:Economic Review
Date:Feb 1, 1992
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