KARACHI, Sept 10: Over the year since 9/11, the corporate sector has gained in some ways and lost in others. But some of the earlier calculations by analysts have also gone awry. Cement sector, for instance, did not go on to make the phenomenal profits that were first envisaged and textile industry did not drop in the dumps as was initially feared.

The 21 listed cement companies have posted an aggregate profit of Rs6.7 million for the third quarter of financial year 2002, compared with the mammoth industry loss of Rs812 million in the first half last year. However, the event that was looked upon as a major catalyst for cement sales and profitability eluded the industry: Exports to Afghanistan. In the rebuilding of that devastated country, Pakistan hoped to reap rich dividends and cement companies, after years of operating at just about half the capacity, geared up to produce at the optimum level — all for exports. But over the last eight months only140,000 tons have been picked up by the Afghan builders, which industry stalwarts say is so small as can do nobody any good.

Textile exporters have been worrying over the drop of the dollar by Rs9 vis-a-vis Pak Rupee — from Rs68 to Rs59, year-on-year, as their sale overseas stands, what they call “subsidized”. War risk surcharge levied by shipping companies also impacted exporters of leather and textile. But, conversely, all industries including textiles, paper & board, leather and pharmaceuticals have benefited from reduction in cost of imported raw materials, because of a weaker dollar. Also as money flowed into the country, through huge increase in remittances, liquidity has vastly improved, pulling down interest rates. Companies have generally seen their bottom lines improve as a result of lower financial charges and those that were highly leveraged have gone to be the biggest beneficiary. Due to improved liquidity and lower interest rates, the auto sector is looking at heftier profits. Commercial banks have generally seen an increase in deposits, because of falling returns on National Saving Schemes. Banks’ spreads have improved and the benefits have travelled down to the net profit level.

Analysts say that because of an increase in disposable income — some of it due to increased inward remittances — the consumer spending has increased which is reflected in larger turnover of fast moving consumer goods (FMCGs) companies. Such companies have also seen a salutary effect on their sales, as first serious efforts were made by the government to clog the channels of smuggling.