To the common individual the ICI name was once synonymous with paints.

It is a little-known fact that the company actually started out with a manufacturing facility for soda ash in 1944 and has since diversified cash flows in a host of businesses; claiming to be one of the largest conglomerates in the country.

The expansion and diversification strategy has hastened under the Yunus Brothers Group that acquired three-quarters of shareholding in ICI Pakistan, with management control, for Rs14.4 billion quite a few years back.

To those investing in stocks, the group’s flagship, Lucky Cement Limited is more widely known as one of the largest cement companies in Pakistan and the mover and shaker on the country’s cement sector owing to its huge market capitalisation.

ICI Pakistan Limited mainly operates in four diverse businesses: polyester, soda ash, chemicals and life sciences.

After taking into its fold the pharmaceutical company, Cirin, the company set its eyes on acquiring certain assets representing the life science business portfolio of Wyeth Pakistan Limited for Rs1.91bn. ICI Pakistan CEO Asif Jooma said this was aimed at broadening the company’s life science range of products.

Total assets of ICI Pakistan at end FY17 stood at Rs38bn. In the summer of 2017, the Board of Directors approved a proposal to establish a facility to manufacture Masterbatch, used in the colouring/pigmentation of various plastics (PE, PP, PVC).

The estimated project cost was Rs590 million and the plant is expected to come online in the first quarter of 2019. “In the chemicals and agricultural sciences business, the ongoing project to set up a Masterbatch manufacturing facility is also progressing as per plan” ICI affirmed in its report released last Wednesday.

“All businesses continue along their growth trajectory,” the company claimed. The polyester and life sciences businesses were the major contributors to revenue

The life science business’s Animal Health Division has recently entered into partnership with a South Korean animal vaccine manufacturer, CAVAC, to import, market and distribute the CAVAC Poultry Biologicals portfolio in Pakistan.

As at the close of FY17, the long-term investments of ICI Pakistan amounted to Rs2.95bn with stake worth Rs500m in ICI Pakistan Power Gen Limited, Rs981m in Cirin Pharmaceutical (Pvt) Limited, Rs510m in Nutrico Morinaga and Rs960m in NutriCo Pakistan.

Paid-up capital of ICI Pakistan Limited stands at Rs923.4m of which 86.1pc shares are held by three associated companies, undertakings and related parties.

Against the paid-up capital of under Rs1bn, the company holds huge unappropriated profit of Rs15bn, which is why the company stock trades at Rs795 for the share of par value of Rs10 at the stock exchange.

Soda ash is its core business, responsible for the biggest share of revenue. The company is a market leader in the soda ash segment with a total capacity of 350,000 tonne per annum.

In a report released last Wednesday, the company stated that the capacity expansion project in soda ash business was in its final stages. Post commissioning, an additional 75,000 tonnes per annum will be added to the existing capacity.

ICI Pakistan also operates one of the largest Polyester Staple Fibre (PSF) plants in the country, accounting for over 22 per cent of total industry production. Yet, PSF has been the business’s bane owing to the glut in the market, together with dumping from abroad.

On Wednesday last, the Board announced financial results for the quarter and six months ended December 31, 2017 with net turnover for the six-month period at Rs23.2bn that represented growth of 18pc over the same period the previous year.

“All businesses continue along their growth trajectory”, the company claimed. The polyester and life sciences businesses were the major contributors to revenue with growth of 24pc and 32pc respectively.

Improved performance in the soda ash and chemicals and agri-sciences businesses also increased net turnover by three per cent and 12pc respectively.

The Company’s operating profit over the six months at Rs2.1bn was higher by six per cent over same period last year, mainly due to improved performance in the polyester and life sciences businesses.

Unconsolidated profit after tax for the six-months stood at Rs1.5bn, which represented a decline of five per cent over the same period last year.

The company attributed the drop mainly to a higher exchange loss of Rs238m caused by the devaluation of the Pakistani rupee, coupled with lower dividend of Rs210m from the company’s subsidiary and associates as compared to the same period last year.

ICI Pakistan also declared interim cash dividend for the year ending June 30, 2018, at Rs8 per share.

In the last quarter, ICI Pakistan held the ground-breaking ceremony of the manufacturing facility for NutriCo Morinaga (Private) Limited, the Company’s majority-owned infant formula joint venture (JV).

Morinaga Milk Industry Company Limited and Unibrands (Pvt) Ltd are the JV partners for local manufacture and marketing of international-quality-standard Morinaga infant formula in Pakistan.

Published in Dawn, The Business and Finance Weekly, January 29th,2018