Lahore - The Hi-Tech Lubricant has established its new blending and filling plant with a huge investment of Rs1.7 billion which is going to be operational in March this year.

The project will cost the company around Rs1.9 billion after its expansion, and it is being financed through a debt to equity of 38:62. The state-of-the-art plant will cater the mid tier users of lubricants, leading to at least 7 percent decline in prices of lubricants in Pakistan where no significant cut in mobil oil prices have been witnessed despite heavy drop in global oil prices.

High-Tech Lubricants Chief Executive Officer Hassan Tahir, while talking to The Nation, said that HTLL is an integrated unit, producing international standard specifications lubricants in HDPE bottles, filling, capping and labelling of finished products on an automated high accuracy filling line. He said that HTLL also decided to go public where we would eventually open Zic service centres. These outlets will be franchised and also company-owned.

“We are looking at over 37 outlets across the country. These outlets would be one-stop-shop with services like car wash, oil changing, realignment, rebalancing, availability of accessories etc.”

HTLL CEO claimed to have an overall market share of 7% in the lubricants market, and is now looking to move forward and achieve over 10% market share by 2020.

Hi-Tech Lubricants has recently listed itself at the bourse by issuing around 29 million shares. The company will offer 7.25 million shares to the general public at a price of Rs62.50 per share in its initial public offering (IPO) which will take place from January 25 to 27.

“With the completion of this second round of fund-raising, Hi-Tech Lubricants will become the first company to be listed on the recently integrated Pakistan Stock Exchange.

Earlier on January 7, the book-building portion of the IPO was over-subscribed by 2.24 times by high net-worth individuals and corporate firms. Hi-Tech Lubricants is offering a total of 29 million shares and is expected to raise Rs1.8 billion after the completion of the process.

“The demand for the company’s shares is a reflection of confidence of investors in the business plan of the company,” he said.

For the past five years, the company has been showing a compound average growth rate of 24%. “In the year 2015, the total sales of the company were recorded at Rs5.4 billion, whereas by 2020, we are looking to increase its sales volume to Rs14 billion,” noted Hassan Tahir.

The company is now focusing on motorcycle oil as well as heavy machinery segment in its upcoming plant that will be fully operational in March 2016.  

Hassan Tahir said that the company is engaged in the sale of imported lubricants and greases etc manufactured by S.K Lubricants, Korea under the brand name of ZIC Lubricants. According to him, S.K Lubricants has over 50 percent of the world’s market share in group III base oil. It has been marketing Lubricants in Pakistan for more than 2 decades now.