Rs 8 billion Fauji Meat plant operational
June 2016 update: Pakistan’s largest conglomerate, the Fauji Group, has launched the country’s biggest halal abattoir, meat processing and exporting unit near Port Qasim, Karachi. The firm that overseas this is called Fauji Meat Limited (FML). Fully operational since April 2016, the $75 million (8 billion PKR) plant has a daily capacity of 100 tonnes of meat. It is expected that by mid-2017, the plant will run at full speed, said Rehan Munawar, COO of FML.
10 June 2015: Fauji Meat – the upcoming player in this sector – is aiming really high. In order to keep its costs low, the firm is considering using sea mode to transport its frozen meat by introducing vacuum packaging to ensure a longer shelf life as opposed to competitor that delivers fresh meat via airplanes. Lower costs will obviously result in higher margins for Fauji, thereby giving it a competitive edge. To add, Fauji Meat is also expected to benefit from income tax holiday as proposed in budget FY16 for firms setting up halal meat processing plants from 1 July 2015 to 31 December 2016. via Business Recorder
Fauji Meat, a wholly owned subsidiary of Fauji Fertilizer Bin Qasim (FFBL), is expected to achieve financial close this month, an FFBL notice to the Karachi Stock Exchange (KSE) said.
According to the notice, the project cost will be funded through a combination of debt and equity in the ratio of 70:30. The debt component will comprise Islamic financing of Rs3.5 billion.
The company had shown interest in setting up the meat subsidiary in December 2014 with a total cost of Rs6.4 billion.
At that time, FFBL anticipated that it would secure the required financing in the first half of 2015 and operations would start in the fourth quarter.
Analysts say FFBL wants to diversify its business owing to the problems of gas shortage and haphazard growth in the fertiliser sector of the country.
Source: The Express Tribune
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