Biafo signs deal to buy new signal transmission tube manufacturing plant

KARACHI: Biafo Industries Limited has signed an agreement for the purchase and installation of a new signal transmission tube manufacturing plant with a cost of Rs392 million, a bourse filing said on Tuesday.

“This is an import substitution project with excellent margins for the company, which eyes the signal transmission tube sales for not only the local market but to develop an export market also,” Biafo said.

The project is on debt: equity basis; whereby, term finance loan of Rs250 million is obtained from the Allied Bank under the State Bank’s temporary economic refinance scheme for the import of plant and machinery. The remaining Rs142 million will be paid by Biafo as equity contribution.

For the nine months period ended March 31, 2021, Biafo posted a net profit of Rs247.7 million, compared with Rs237 million in the corresponding period.

For the period under review, supplies to the oil and gas sector decreased because of continued less exploration seismic activity and a general slowdown of activities in the large projects due to the Covid-19 pandemic. However, sales to cement and export sectors have shown substantial growth, compared with the nine months ended March 2020.

Biafo has the modern and state-of-the-art manufacturing unit, which is highly automated and can produce explosives and powder explosives (ANFO).

Biafo also produces a large line of blasting accessories for explosives from technology initially obtained from Hanwha Group of South Korea and with the continuous in-house research and development has developed other products as per the demand of the local market.

Looking forward, the company will continue to strengthen its position in the market to tap the opportunities emerging from the China-Pakistan Economic Corridor (CPEC) and allied infrastructure projects.