Pakistani-Chinese joint venture Service Long March (SLM) Tyre will soon boost Pakistan’s domestic tyre manufacturing and reduce its reliance on imports. The announcement follows a historic financial milestone for the company. SLM Tyres recently raised Rs7.78 billion ($28 million) in its Initial Public Offering (IPO) at the Pakistan Stock Exchange (PSX), marking the largest private sector IPO in the country’s history.
A Strategic Partnership
Partners established SLM Tyres in 2020 as a joint venture between China’s Chaoyang Long March Tyre Company Limited, Pakistan’s Service Industries Limited, and Myco Corporation. The company manufactures radial tires for heavy commercial vehicles by combining advanced Chinese technology with local Pakistani manufacturing power.
Officials state that this investment will enhance local production capacity, cut down on imports, and boost the country’s export potential. They also view the milestone as a sign of a promising future for Pakistan-China cooperation in industrial growth and financial integration. China remains a major investor in Pakistan, having already pledged over $65 billion under the China-Pakistan Economic Corridor (CPEC) alongside various private sector joint ventures.
Driving Export-Led Growth
During the IPO ceremony on June 15, Finance Minister Muhammad Aurangzeb emphasized the importance of private sector participation in capital markets to drive economic growth. He noted that teams built SLM during the peak of COVID-19 using Chinese expertise and investment. The minister added that the company is already among the most profitable tire companies globally and is on track to achieve $100 million in exports next year. He highlighted SLM as proof that Pakistan can deliver industrial growth through an export-led model.
Unprecedented Investor Demand
The IPO drew massive interest from both institutional and retail investors, including banks, mutual funds, insurers, pension funds, brokers, and foreign investors. While the company set the initial floor price at Rs14.25 ($0.0513) per share, strong demand during the book-building process pushed the final strike price up to Rs19.95 ($0.0718).
SLM Tyres Chief Executive Officer Omar Saeed expressed deep gratitude to the investors for their unprecedented interest. He stated that the venture successfully placed Pakistan on the global map as a tire-exporting country, and he intends to keep that momentum going.
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