Rwanda’s leading cement maker Cimerwa PPC Ltd has kicked off 2018 with a new branding exercise meant to fortify its top ranking position in the local cement market.
The repositioning of the Cimerwa brand in the market is seen as responses by its management to growing competition especially from regional brands angling for a bigger share of the lucrative projects forming part of ongoing construction boom in Rwanda.
Last year, Rwanda Development Board (RDB) registered investments in real estate and construction worth US$540 million from three big ticket projects.(see related story “property review 2017”).
The three big ticket construction projects, experts says, signals the ongoing construction boom to be the focal point of intense competition among local and regional brands jostling for more market share in the local cement market.
Experts are saying the pipeline of big ticket deals in Rwanda is more than US$1.6 billion in the next 2-3 years further signaling the growing appetite of cement makers both local and regional to the huge opportunity Rwanda offers cement producers in next 5 years.
Cimerwa PPC Ltd is in pole position to take up and sustain largest market due to a number of reasons. A major reason is that Cimerwa PPC Ltd is a Rwandan heritage brand in the cement market enjoying better market perception in the eye of local consumer.
The heritage brand positioning that Cimerwa PPC Ltd enjoys gives it due comparative advantage in the “Made in Rwanda” drive whereby the government of Rwanda is keen to promote production and consumption of locally made products.
Bheki Mthembu CEO Cimerwa PPC Ltd
says that his firm with over 60 percent of market share will continue with its drive to lead the market by continuing to seize opportunities to capitalize on its commitment to assist with efforts aimed at building a stronger local economy.
“From a business perspective, there was a need to refresh our brand message; ever since we acquired an investing partner called Pretoria Portland Cement Co Ltd (PPC), South Africa’s leading cement manufacturer,“
5 year ago, as part of larger dynamics shaping cement market PPC Ltd acquired a 51 percent stake in Cimerwa Ltd for a deal worth US$170 million that gave PPC a platform to enter the East and Central African market.
However, as the year 2018 unfolds experts say that competition in the local cement market is meant to get more intense fought by regional brands eager to displace local brands in order to angle for a piece of ongoing construction boom.
The regional brands such as Hima cement controlled by La Farge Group of France- major competitor to PPC of South Africa offer certain advantages according to market analysts.The analysts point out the issue of price advantage that regional brands have over local brands which “Made in Rwanda” drive is meant to re calibrate.
Official statistics indicate that in 2016, Rwanda imported 80,000 tonnes of cement from Tanzania and a further 165,000 tonnes from Uganda in order to bridge rising demand.
Cimerwa PPC Ltd capacity after the acquisition of the company by PPC stands at 600,000 tonnes annually which is meant to satisfy local demand estimated at 450,000 tonnes annually and balance of 150,000 tonnes is meant to be exported.