ISLAMABAD: A Pakistani-Chinese joint venture, Service Long March (SLM) Tyres, will boost Pakistan’s domestic tire manufacturing and reduce the country’s reliance on imports, Pakistani state media reported on Sunday, citing officials.
The report comes more than a week after SLM Tyres raised Rs7.78 billion ($28 million) in its Initial Public Offering (IPO) at the Pakistan Stock Exchange (PSX), which the PSX described as the largest private sector IPO in the country’s history. It followed an announcement by SLM Tyres in April, saying it had received approval from the PSX for its IPO of 389.738 million shares.
SLM Tyres was established in 2020 as a joint venture between China’s Chaoyang Long March Tyre Company Limited and Pakistan’s Service Industries Limited and Myco Corporation. The company manufactures radial tires for heavy commercial vehicles, combining advanced Chinese technology with local manufacturing capabilities in Pakistan.
“The investment will help enhance local tire manufacturing capacity, reduce dependence on imports, and boost export potential,” the state-run Radio Pakistan broadcaster reported, citing officials.
“The development is being seen as a reflection of a promising future for Pakistan-China cooperation in investment, industrial growth, and financial integration.”
China is a major ally and investor in Pakistan and has pledged over $65 billion in investment in road, infrastructure and development projects under the China-Pakistan Economic Corridor (CPEC), besides several Chinese private sector manufacturers undertaking joint ventures in the South Asian country.
Speaking at the SLM Tyres IPO ceremony on June 15, Finance Minister Muhammad Aurangzeb stressed the need to boost private sector participation in capital markets to drive economic growth, industrial development, and investment mobilization.
“The listing of SLM is a proud milestone, built during the peak of COVID with Chinese expertise and investment, and now on track to achieve USD 100 million in exports next year,” the minister was quoted as saying by the PSX.
“Service Long March is already among the most profitable tire companies globally, proving that Pakistan can deliver industrial growth with an export-led model.”
The SLM IPO attracted participation from institutional and retail investors including banks, mutual funds, insurers, pension funds, brokers, high-net-worth individuals, and foreign investors, according to the PSX.
The IPO floor price was set at Rs14.25 ($0.0513) per share, with strong demand during book building driving the strike price higher to Rs19.95 ($0.0718).
SLM Tyres Chief Executive Officer Omar Saeed said he was deeply grateful to investors for the unprecedented interest shown in the IPO.
“Pakistan is now on the global map as a tire exporting country, and we intend to keep this journey going,” he was quoted as saying.
