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Report Date : |
15.02.2014 |
IDENTIFICATION DETAILS
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Name : |
GUL AHMED TEXTILE MILLS LIMITED |
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Registered Office : |
Plot No. 82, Main
National Highway, Landhi, Karachi, |
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Country : |
Pakistan |
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Financials (as on) : |
2013 |
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Date of Incorporation : |
1953 |
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Com. Reg. No.: |
0000586 |
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Legal Form : |
Public Limited Company |
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Line of Business : |
Subject is engaged d
in the manufacture and sale of textile products |
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No. of Employees : |
5,000+ |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment Behaviour : |
No complaints |
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Litigation : |
Clear |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – September 30, 2013
|
Country Name |
Previous Rating (30.06.2013) |
Current Rating (30.09.2013) |
|
Pakistan |
B2 |
B2 |
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Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
PAKISTAN - ECONOMIC
OVERVIEW
Decades of internal political disputes and low levels of foreign investment have led to slow growth and underdevelopment in Pakistan. Agriculture accounts for more than one-fifth of output and two-fifths of employment. Textiles account for most of Pakistan's export earnings, and Pakistan's failure to expand a viable export base for other manufactures has left the country vulnerable to shifts in world demand. Official unemployment is under 6%, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Over the past few years, low growth and high inflation, led by a spurt in food prices, have increased the amount of poverty - the UN Human Development Report estimated poverty in 2011 at almost 50% of the population. Inflation has worsened the situation, climbing from 7.7% in 2007 to almost 12% for 2011, before declining to 10% in 2012. As a result of political and economic instability, the Pakistani rupee has depreciated more than 40% since 2007. The government agreed to an International Monetary Fund Standby Arrangement in November 2008 in response to a balance of payments crisis. Although the economy has stabilized since the crisis, it has failed to recover. Foreign investment has not returned, due to investor concerns related to governance, energy, security, and a slow-down in the global economy. Remittances from overseas workers, averaging about $1 billion a month since March 2011, remain a bright spot for Pakistan. However, after a small current account surplus in fiscal year 2011 (July 2010/June 2011), Pakistan's current account turned to deficit in fiscal year 2012, spurred by higher prices for imported oil and lower prices for exported cotton. Pakistan remains stuck in a low-income, low-growth trap, with growth averaging about 3% per year from 2008 to 2012. Pakistan must address long standing issues related to government revenues and energy production in order to spur the amount of economic growth that will be necessary to employ its growing and rapidly urbanizing population, more than half of which is under 22. Other long term challenges include expanding investment in education and healthcare, adapting to the effects of climate change and natural disasters, and reducing dependence on foreign donors
|
Source
: CIA |
GUL AHMED TEXTILE
MILLS LIMITED
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Registered Address |
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Plot No. 82, Main
National Highway, Landhi, Karachi, Pakistan |
|
Tel # |
92 (21) 111-485-485,
35082626, 35015702 |
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Fax # |
92 (21) 35082625 |
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Email |
H-7, Landhi Industrial Area,
Karachi, Pakistan
|
a. |
Nature of Business |
Engaged in the
manufacture and sale of textile products |
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b. |
Year Established |
1953 |
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c. |
Registration # |
0000586 |
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Hyder Bhimji & Co. (Chartered Accountants) |
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Gul Ahmed Textile Mills Limited is a public limited Company incorporated
in Pakistan, with its shares quoted on the Karachi & Lahore Stock
Exchanges of Pakistan |
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Names |
Designation |
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Mr. Mohomed Bashir Mr. Zain Bashir Mr. Ziad Bashir Mr. Mohammed Zaki Bashir Mr. Abdul Aziz Yousuf Mr. S.M. Nadim Shafiqullah Mr. Abdul Razak Bramchari Dr. Amjad Waheed Mr. Adnan Afridi |
Chairman & Chief Executive Director Director Director Director Director Director Director Director |
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Names |
Shareholding (%) |
|
Individuals Investment
Companies & Mutual Funds Insurance
Companies Joint Stock
Companies Modaraba
Companies Financial
Institutions Foreign Investors Charitable
Institutions Government
Departments |
73.45 2.63 3.96 0.09 0.02 --- 19.79 0.05 0.01 |
|
(1) Gul Ahmed
International Limited ( FZC), UAE (2) GTM (Europe)
Limited, U.K. (3) Gul Ahmed Textile
Limited, Pakistan. (4) Pakola
Products Limited, Pakistan. (5) Safe Mix
Concrete Products Limited, Pakistan. (6) Excel
Insurance Company Limited, Pakistan. (7) Gul Ahmed
Holdings (Pvt) Limited, Pakistan. (8) Globe
Management (Pvt) Limited, Pakistan. (9) Metro Power
Company, Pakistan. (10) GML Capital
(Pvt) Limited, Pakistan. (11) Pakistan
Beverages Limited, Pakistan. (12) Fun Product
Pakistan (Pvt) Limited, Pakistan. (13) Yassir Fruit
Juices (Pvt) Limited, Pakistan. (14) Yassir
Industries (Pvt) Limited, Pakistan. (15) Yassir
Distributors (Pvt) Limited, Pakistan. (16) GML
Technologies (Pvt) Limited, Pakistan. (17) Globe
Garments (Pvt) Limited, Pakistan. |
Engaged in the manufacture and sale of textile products
More
than 5,000
2013 2012
Capacity Production Capacity
Production
Cloth (In Sq meters 50 picks
Converted 136,745 83,819 124,136 81,096
Yarn (Kgs 20 Counts
converted) 49,055 37,501 48,227 36,525
Shifts 3
shifts 3 shifts
Production is lower due to variation in production mix and various technical factors.
Various Local
|
(1) Allied Bank
Limited, Pakistan. (2) Bank Al Habib
Limited, Pakistan. (3) Citibank,
N.A., Pakistan. (4) Habib Bank
Limited, Pakistan. (5) Habib
Metropolitan Bank Limited, Pakistan. (6) HSBC Bank
Middle East Limited, Pakistan. (7) Meezan Bank
Limited, Pakistan. (8) National Bank
Of Pakistan, Pakistan. (9) NIB Bank
Limited, Pakistan. (10) Standard
Chartered Bank (Pakistan) Ltd, Pakistan. (11) The Royal
Bank Of Scotland Limited, Pakistan. (12) United Bank
Limited, Pakistan. (13) Bank Islami
Pakistan Limited, Pakistan. (14) Faysal Bank
Limited, Pakistan. (15) Dubai
Islamic Bank, Pakistan. (16) Burj Bank
Limited, Pakistan. |
Sound
Despite all the challenges mentioned above in the economic environment, we
are optimistic for FY 2012-13. We anticipate improvement in export demand from
January 2013. looking ahead, the Company’s business piorities and areas of
focus will continue to be shaped by enhancement of Company’s value by achieving
higher production and financial efficiencies, maintaining optimum quality,
product diversification and exploring new markets. The recent reduction in
discount rate by state bank of Pakistan and consequent decrease in export
refinance rates will result in lower financial charges. Company focuses to
develop and strengthen exports by exploring new customers across the globe to
improve its top line.
All Pakistan Textile Mills Association.(APTMA)
Federation Pakistan Chamber of Commerce & Industry.(FPCCI)
Karachi Chamber of Commerce & Industry.(KCCI)
|
Currency |
Unit |
Pakistani Rupee |
|
US Dollar |
1 |
Rs. 106.00 |
|
UK Pound |
1 |
Rs. 173.25 |
|
Euro |
1 |
Rs. 144.00 |
Subject Company is well known and the directors are resourceful and experienced businessmen. Trade relations are reported as fair. Payments to creditors etc are reported as normal. Subject can be considered for normal business dealings at usual trade terms and conditions.
HALF YEARLY RESULTS OVERVIEW
The year 2013 ended on a mixed note for the economy of Pakistan.
Positive indicators included sharp appreciation in real-estate and capital
markets, increase in industrial activity and Government’s commitment to the
program of IMF. Local business sentiment also showed positive signs though
increase in private sector credit off-take. However, challenges of energy
shortage, law and order, rising inflation, lower tax to GDP ratio continue to
be major obstacles to sustainable growth. Overall commitment and fiscal
restructuring is needed to keep economy on the track. Overall agricultural
sector posted 3.3% against the target of 4% due to slowdown in the major crops
except sugarcane. Cotton arrival todate in the current FY 2014 is 12.9 million
bales as compared 13.1 million bales in the whole of FY 2013. Growth in
manufacturing sector is 4.4% which is highest in last five years. Low foreign
exchange reserves are exerting pressure on rupee and increase in discount rate
to 10% by State Bank of Pakistan (SBP) has increased the financial cost. The
CPI inflation in December 2013 was recorded at 9.2% (YoY basis) whereas it was
7.9% (YoY basis) in December 2012. Substantial increase in gas prices has
further increased the cost of production of textile industry adversely
impacting its global competitiveness. As per the Annual Report 2013 of State
Bank of Pakistan, exports of the country has grown by 3.5% in FY 2013 as
compared to the decline of 4.4% in last year, which was largely due to the
waiver of duty on 75 products of mainly textile items to European Union (EU)
market and increased demand of yarn and fabric to China and Hong Kong.Only
textile exportshavegrown by 5.9% as compared to the decline of 10.6% in FY
2012. We welcome the granting of GSP plus Status to Pakistan by EU. These trade
concessions will benefit the country’s exports including textile madeups by
enabling its products to compete with other countries who have similar
concessions.
Your Company has produced encouraging results which are represented by
growth in sales by 19% over the corresponding period. A significant growth was
noted in gross profitwhich is 47% over the corresponding period, amounting to
Rs. 2,923million. The Company has earned profit before tax of Rs. 672 million
versus profit before tax of Rs. 230 million in the same period of 2012. Profit
after tax for the period is Rs.570 million as compared to profit after tax of
Rs. 171 million in the previous period.Earnings per share is Rs. 3.12 as
compared to Rs. 0.94 in the corresponding period.
December December
2013 2012
Rupees in millions
Sales 15,613 13,173
Gross profit 2,923 1,992
Profit before tax after providing
depreciation / amortization of Rs 407 million
(2012: Rs. 371 million) 672 230
Profit after tax 570 171
We expect a steady improvement in the macroeconomic indicators in the
long term based on inflows from International Financial Institutions,
privatization of non performing public entities, determination to cut
subsidies. Exports are also expected to perform better due to GSP plus status
granted to Pakistan. SBP has forecasted 6% increase in exports in the remaining
FY 2014 due to the GSP plus status and Government’s decision to divert gas to
industrial sector to reap benefits of said status. Company is optimistic to
find avenues for growth focusing to avail benefits under the GSP plus scheme.
Not limited to this we strictly follow our strategy to expand and gain a
competitive edge over our competitors. Your Company aims to execute through
best possible initiatives targeted towards key motivators and customers,
through new business development and through
effective cost and margin management.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.62.28 |
|
|
1 |
Rs.103.67 |
|
Euro |
1 |
Rs.85.18 |
INFORMATION DETAILS
|
Report Prepared
by : |
NIS |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall
operation is considered normal. Capable to meet normal commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with full
security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
-- |
NB |
New Business |
-- |
This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.