Construction sector eyes huge opportunities
AS Zimbabwe witnesses increased economic activity following the relaxation of Covid-19 restrictions, listed construction companies and related firms are pinning hopes on several projects lined up by both Government, the private sector and individuals.
The economy is projected to grow by 5,5 percent this year supported by increased agricultural production and mining.
Market watchers say this will increase disposable incomes and boost the construction industry.
Various projects are already underway in road construction, including water and housing infrastructure, among others.
Experts say the projects are equally spread across both the public and private sector.
Government’s renewed interest in infrastructure development was the key driver of growth in road projects and earthworks.
Contract periods also improved from short-term to medium- and long-term on the back of an improved operating environment.
Demand for construction material such as bricks, cement, roofing and plumbing materials has been rising exponentially.
Turnall chairperson Mr Bothwell Nyajeka said plans were underway to invest in a new plant and resume production of roofing sheets in Harare to augment the Bulawayo plant in line with increasing demand for the company’s products.
Additionally, the group is also looking at commissioning a Glass-Reinforced Plastic (GRP) pipe plant, which will bring diversity to its range of pipes.
It is envisaged that the new large diametre pipe plant should also play a critical part in the Government’s plans to both create manufacturing jobs and improve water supplies around the country.
“Management is extremely optimistic that the business will continue to grow and maximise shareholder wealth,” he said in an update for the year to December 31, 2021.
At Masimba Holdings Limited, management is upbeat of a solid performance, supported by a strong order book valued US$214 million by close of 2021.
The book is evenly balanced between private and public sector projects spread over housing, buildings, roads, mining and water infrastructure.
“The infrastructure development prospects remain bright as evidenced by a long project pipeline and increased tendering activities.
“However, the execution thereof may be detracted by the continued foreign currency shortages and pricing distortions,” said the company’s chair, Mr Gregory Sebborn.
“We, therefore, urge the relevant authorities to pursue macroeconomic stabilisation policies for the contracting sector, in particular, to contribute to the attainment of the objectives of the National Development Strategy.”
For bricks manufacturer Willdale, several housing developments by both individuals and institutional developers are expected to drive strong demand this year. Although Covid-19 disrupted the smooth flow of business in 2021, Willdale recorded a 32 percent volumes growth, while production jumped 19 percent ahead of prior year.
Willdale expects to maintain this growth momentum driven by strong appetite for modern housing, coupled with Government’s drive to reduce the housing backlog under the NDS1.
Listed property firms like First Mutual Properties and Mashonaland Holdings Limited are also banking on various projects as they also seek to diversify and expand their portfolios.
While Lafarge is upbeat about its prospects, the cement maker also expressed concern that geopolitical developments such as the conflict in Ukraine could weigh down activity as a result of supply chain disruptions.
Generally, the company is “optimistic about the opportunities in the infrastructure sector as the Government continues with its strategy for infrastructure development”.