Despite some investments along the way, Attock cement has been marked with stagnant profitability and growth trends lacking in luster. Now last week, the company disclosed that its Lebanese owners are mulling over their “long-term strategic options, including a potential sale” in relation to their investment.

Considering a glass half-full scenario, this is good news. The company has recently made some choice investments. It invested roughly $4 million in a wind power unit to reduce reliance on the grid and in turn its power costs. Last year, the company added a new line to enhance capacity by 1.275m tons bringing its total capacity up to over 4.3 million tons. This has brought its market share by capacity up from 4 percent to 5 percent, which will naturally trickle down to an improved market share with dispatches, considering its existing market presence and promotional outreach.

The company heavily relies on the more economical coal sourced locally which brings down its costs and as a result, Attock’s margins have always stayed ahead of average industry margins, though still much farther away from the margins of some of the top players. At the same time, due to lower domestic demand in the southern zone where the plants reside, and heavy competition from Lucky Cement, arguably the biggest cement player in the country, Attock relies heavily on exports. Where Attock gets beat is strong pricing competition in the exporting markets and having to make significant efforts to grow market share in the domestic market. When domestic demand is low—as has been the case for the past two years—exports have to be front and center.

As it stands, Attock’s share in the market has not edged too much, staying in the range of 5 and 6 percent over the past several years. However, its export share has grown from 10 percent in FY15 to 21 percent and 22 percent during FY19 and FY20 and back down to 15 percent in FY24. When the global market becomes more receptive, and pricing is reasonable, Attock has gained in markets abroad. In Fy20, when the profitability of the entire industry declined, Attock was one of the few companies whose after-tax profits remained intact.

Perhaps, the company has a fall-back plan in the form of exports, but its revenue growth (up only 2x in the past decade) and its earnings up 1.6x in 10 years are not entirely aspirational. In fact, if FY24 was eliminated from this analysis—as profits grew due to a one-off payment– the company’s earnings between FY15 and FY23 have actually declined.

Any other player in the north zone that has been eyeing Attock’s geographic location fit for seaborne exports and hoping to drop its name in the hat would have to come in with a solid plan for a turnaround.