“Lucky Motor Corporation (LMC) manufactures Samsung Mobile devices.” It is big news for the mobile industry in Pakistan. A subsidiary of Lucky Cement Ltd (LCL), Lucky Motor Corporation (LMC) has signed a joint venture with Samsung Gulf electronics co, FZE for manufacturing Samsung Mobile devices in Pakistan. LMC which is well known for assembly, marketing, manufacturing, sales, and distribution of Peugeot and Kia-like vehicles has taken this initiative to enhance its production base.
LMC has filed an application with Pakistan Telecommunication Authority (PTA) for getting the manufacturing license. It has started to make necessary arrangements to secure regulatory approvals for production concerns.
LMC has decided to install Samsung mobile production facility at Bin Qasim Industrial Park. This park has the status of Special Economic Zone. The company’s representatives are of the view that Lucky Motor Corporation (LMC) manufacturing Samsung Mobile devices production facility is expected to be completed by Dec 2021.
Mobile Device Manufacturing Policy (MDMP) 2020 approved by Engineering Development Board (EDB) allowed 21 companies to start production at a local level. The venture between both the companies is being considered as green signal for devising local manufacturing as well as assembly lines.
Lucky Motor Corporation (LMC) has initiated dialogues with Samsung to discuss finance and production nitty-gritty. Both parties have opted to produce a wide range of android cell phone models.
CFA at Topline securities, Syed Atif Zafar stated that venture capital is expected to be worth an amount of Rs. 16.5 bn. He further elaborated that LMC is going to generate average earnings of Rs.15 bn before taxes, interest, amortization, and depreciation from its auto assembly plants in the next two years. So, the arrangement of the required capital is not a serious issue for the company.
Syed Atif Zafar has high hopes for the project. He anticipated that project of manufacturing Samsung devices is expected to generate revenue of 300-600 million USD. It is supposed to extract a net profit of Rs1.0-1.5 bn in its initial years.
Moreover govt. looks very positive to pull Foreign Direct Investment (FDI) in order to boost up local industry. In this regard, the govt. gives the facility of duty protection due to MDM Policy. The duty reduction stance of govt. will revamp the mobile manufacturing industry and reduce the prices of locally manufactured mobiles up to 50 pc.
The lucky group which is known for its success stories owns 71.55 pc of LMC. It has earned a good repute for bringing Korean-based KIA to Pakistan to assemble automobiles and acquisitions. Turnarounds of ICI Pakistan is another glorious achievement of the group. keeping in view these successive achievements, all the stakeholders have high hopes with LMC for this JV.
On the other hand, Samsung is a Multinational Corporation (MNC) which is producing 2.5 million units in Bangladesh annually. It has successfully installed an assembling plant in Bangladesh in 2018. 95 percent of the phones sold out in Bangladesh are produced locally. Mr. Zafar further added that Pakistan is a big market for android handset usage.
There arises a need for 45 million handset users in Pakistan out of which 32 million handsets are imported while 13 million handsets are manufactured at the local level.
According to data provided by the Bureau of statistics, Pakistan is considered a very lucrative market for investors with an estimated worth of 2.5bn mobile sets.