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ICC Industries
Limited ( Formerly ICC Textiles Limited ) "the Company" was incorporated in
Pakistan on May 25, 1989 as a public limited company (PIC) under the
repealed Companies Ordinance, 1984 (Repealed with the enactment of the
Companies Act, 2017 on May 30, 2017). The shares of the Company are listed
on Pakistan Stock Exchange.
The principal
activity of the Company is renting out vacant buildings and / or open area
of the Company's premises. The registered office of the Company is situated
at 242-A, Anand Road, Upper Mall, Lahore and the Company's premises are
located at 32-Km Multan Road, Sundar, Lahore.
Background:
To avail the lucrative incentive policy of the
late 1980's for Industrial investment in the Textile sector, our well
established business group set up a modern Textile weaving project in 1990
comprising 60 Sulzer shuttleless looms with complete European backup process
and to optimize the scale of the project, the capacity was enhanced by
adding 40 additional Sulzer dobby looms through company’s self cash flows,
without seeking funds from the banks or public money. Further, while going
along with the technology and capacity enhancement spirit in the entire
textile weaving sector in Pakistan, anticipating huge market potential due
to the abolishment of the quota regime in Jan 2005, our management decided
to increase the production volume by installing additional 72 state of the
art air-jet looms along with complete new back process and ancillary
equipment which came into production in March 2005. However, the anticipated
positive results could not be achieved, as there was a capacity boom in the
entire Asian region, creating a huge fabric glut thus bringing down the
prices. The excessive cheap textile exports from China along with huge
government subsidies in our competing countries rendered exports from
Pakistan unviable.
The grave situation
resulted in closure of a substantial portion of the Industry with numerous
bank defaults and retrenchment of workforce. The brunt of the negative
impact was felt by the Capital Intensive, Modern, Small to Medium Size Stand
alone Shuttleless Weaving Sector.
Despite all these difficulties, ICC Textiles
managed to sustain with an efficient production system and a diversified
share in the export market, while servicing all its financial liabilities.
A new
challenge, specific to Pakistan, was introduced in 2006 due to the shortage
of gas resulting in the start of the grave menace of Electricity load
shedding. The entire organized weaving sector switched to Captive power by
setting up their own gas based power plants.
Unfortunately,
ICC Textiles could not benefit from this facility as we were denied an
Industrial gas connection on the pretext that our Plant was not located on
the main gas pipeline route and was not part of an Industrial cluster. At
ICC Textiles, the energy problem was even more severe, as it was the only
Capital & energy Intensive, Export Oriented, Continuous process, Modern
Weaving unit which was deprived of cheap electricity due to non availability
of a Captive power Gas connection. Moreover, as the plant is located in
close vicinity of city of Lahore, it was exposed to abnormally excessive
load shedding and electricity interruptions thus incurring huge costs for
reduced production.
Despite
successive government promises, the energy problem of the country kept on
deteriorating with the passage of time, resulting in massive electricity
load shedding coupled with high electricity tariff. ICC Textiles reliance on
the only available alternative of expensive diesel based back up power was
not a lasting solution. Moreover, the government policy of keeping the
artificially high value of Rupee exchange rate and abolishing all incentives
for the textile industry made our project financially unviable with no signs
of improvement.
Hence, in
2017, the Directors of ICC Textiles decided to suspend the Textile
operations to stop further accumulation of company's losses and liabilities
and Directors of the company approved a plan to consolidate the company’s
resources by paying its bank liabilities through sale of textile machinery
and sponsors funds injection and to renting out its vacant buildings and
open area to genera revenue.
The plan has
been successfully implemented i.e. bank borrowings have been fully repaid by
April 2018 and company has rented out substantial portion of its factory
premises to generate revenue. Accordingly, principle line of business has
been changed in February 2020, with the approval of Securities and Exchange
Commission of Pakistan, as under:
“Principal line of business of the Company shall be to
provide facilities for storage on proprietary as well as rental basis and to
undertake real estate development including investment, construction,
purchase, sale, lease and disposal of real estate assets.”
However, as
our existing textile infrastructure is intact, we may consider to evaluate
and invest in the new textile weaving technology in future. |
