KSB Pumps Company Limited (KSBP) has decided to temporarily suspend its Hasanabdal plant operations from January 02, 2023, the company announced to the Pakistan Stock Exchange (PSX) on Monday, the first working day of the new year.
The notice read, “Due to import restriction, KSB Pakistan has temporarily suspended the plant operations at Hasanabdal till further notice w.e.f January 02, 2023.”
The import restrictions, placed in May of last year after the change of government, had led to the closure of operations of many of the end customers of KSBP. These restrictions also impacted the clearance of consignments of raw materials and components necessary for the company’s production operations. The lack of demand in the market made it superfluous for the company to continue its production plant at Hasanabdal, its sole factory in the country.
The company says it will resume operations as soon as the market situation improves and staff may be readily recalled on short notice.
KSBP is a major supplier to a variety of industries but since the manufacturing sector has taken a hit recently owing to an economic downturn, the company has been facing demand challenges. Its major clients in the automotive industry, such as Suzuki, Millat Tractors, and Indus Motors, have all reduced production citing economic challenges and lack of demand.
Suzuki announced its first plant shutdown for 2023 after a string of nonoperational days last year. Similarly, Toyota also shut down production in December last month. Similarly, Balochistan Wheels and Millat Tractors have also had non-operational days.
In other sectors, Kohinoor Spinning Mills temporarily shut down citing the worst crisis faced by the textile industry in December. Another leading textile company, Nishat (Chunian) Limited, also closed almost a quarter of its production last month. Fauji Fertilizer Bin Qasim Limited (FFBL) also closed its Diammonium Phosphate (DAP) Plant temporarily. Suraj Cotton Mills also reduced its production by 40% in the last month of the previous year.
Sales for the third quarter of KSBP were Rs. 1,204 million, an increase of 35% compared to the same period last year. Although the results for the last quarter have not been made public yet, it is likely that they are not very promising in light of the demand challenges. The company also posted a quarterly Profit After Tax (PAT) of Rs. 8.26 million, an increase of over 120% compared to the same period last year.
KSB Pumps Company Limited (a KSB group company) was incorporated in Pakistan in 1959 and has been listed on the Pakistan Stock Exchange Limited since 1979. The company is a subsidiary of KSB SE & Co. KGaA, a German multinational, and is principally engaged in the manufacture and sale of industrial pumps, valves, castings and related parts and after market services. The factory of the Company is situated at Hazara Road, Hassanabdal. The Company also has regional offices located in Lahore, Rawalpindi, Karachi and Multan.
KSB Pakistan has led the pump, valve and system solutions market in the country for over six decades in addition to exporting its products to foreign markets. It specialises in six market areas, i.e. General Industry, Mining, Energy, Building Services, Petrochemicals / Chemicals and Water.
The KSB Group finds its origin in Frankenthal, Germany and is a leading international supplier of pumps, valves and related systems for industrial applications, building services, process engineering, energy conversion, water treatment, water transport, solids transportation and other related applications. KSB Group has been growing continuously since its foundation in 1871, and today operates in more than 100 countries of the world with its own sales & marketing companies, manufacturing facilities and after sales service operations.
After becoming a Public Limited Company in 1979, KSB Pakistan received its first ISO Certification in 1997, and moved on to become the First Foundry based Engineering Company in Pakistan.
The KSB Foundry was established in 1980 and measures a capacity of Ferrous casting of 3500 Tons / annum and Non‐ferrous of 100 Tons/ annum. A Rapid Quenching Heat Treatment Furnace is also available for special grades which is capable of manufacturing sophisticated automotive component castings namely for leading automobile manufacturers including Indus Motor Company, Honda Atlas, Nissan Diesel Trucks and Perkins & Massey Ferguson Pvt. Ltd. apart from pumps & valves castings.
The single largest shareholding in the company is by its parent company M/S, KSB SE & CO, KGaA, which holds 58.89% of the shareholding. The rest of the shareholding is all free float owned by local investors, institutions, and banks.