MIRA INFORM REPORT

Report No. :	348795
Report Date :	16.11.2015

IDENTIFICATION DETAILS

Name :	MAHMOOD TEXTILE MILLS LIMITED

Registered Office :	Mehr Manzil, Lohari Gate, Multan

Country :	Pakistan

Financials (as on) :	30.06.2015

Year of Establishment :	1970

Com. Reg. No.:	0003079

Legal Form :	Public Limited Company

Line of Business :	Manufacturing & Sale of Yarn, Grey Cloth and Generation of Electricity.

No. of Employees :	2,049

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory

Payment Behaviour :	No Complaints

Litigation :	Clear

NOTES:

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ECGC Country Risk Classification List – March 31, 2015

Country Name

Previous Rating

(31.12.2014)

Current Rating

(31.03.2015)

Pakistan

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
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-fourth of output and two-fifths of employment. Textiles account for most of Pakistan's export earnings, and Pakistan's failure to diversify its exports has left the country vulnerable to shifts in world demand. Official unemployment was 6.9% in 2014, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Pakistan's human development continues to lag behind most of the region.. As a result of political and macroeconomic instability, the Pakistani rupee has depreciated more than 40% since 2007. The government agreed to an International Monetary Fund Standby Arrangement in November 2008 to preventa balance of payments crisis, but the IMF ended the Arrangement early because of Pakistan's failure to implement required reforms. The economy has stabilized, it continues to underperform and foreign investment has not returned to levels seen during the mid-2000s, due to investor concerns related to governance, electricity shortages, , and a slow-down in the global economy. Remittances from overseas workers, averaging more than$1 billion a month, remain a bright spot for Pakistan. After a small current account surplus in fiscal year 2011 (July 2010/June 2011), Pakistan's current account turned to a deficit where it remained through 2014, spurred by higher prices for imported oil and lower prices for exported cotton. In September 2013, after facing balance of payments concerns, Pakistan entered into a three-year, $6.7 billion IMF Extended Fund Facility. The Sharif government has since made modest progress implementing fiscal and energy reforms, and in December 2014 the IMF described Pakistan's progress as "broadly on track." Pakistan remains stuck in a low-income, low-growth trap, with growth averaging about 3.5% per year from 2008 to 2014. Pakistan must address long standing issues related to government revenues and the electricity and natural gas sectors 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

Company Name

Business Name

MAHMOOD TEXTILE MILLS LIMITED

Full Address

Registered Address

Mehr Manzil, Lohari Gate, Multan, Pakistan

Tel #	92 (61) 111-181-181
Fax #	92 (61) 4511262
Website	www.mahmoodgroup.com

Short Description Of Business

a.	Nature of Business	Engaged in manufacturing & Sale of yarn, grey cloth and generation of Electricity
b.	Incorporated	1970
c.	Registration No.	0003079

Mills Locations

(1) Mahmoodabad, Multan Road, Muzaffargarh, Pakistan.

(2) Masoodabad, D.G. Khan Road, Muzaffargarh, Pakistan.

(3) Chowk Sarwar Shaheed, District Muzaffargarh, Pakistan.

Auditors

Hameed Chaudhri & Co.

(Chartered Accountants)

Legal Status

The Company was incorporated in Pakistan in the year 1970 as a Public Limited Company and its shares are listed at stock exchanges of Pakistan

Details of Management

Names

Designation

Mr. Khawaja Muhammad Masood

Mr. Khawaja Muhammad Iqbal

Mr. Khawaja Muhammad Ilyas

Mr. Khawaja Muhammad Younus

Mr. Jalal-Ud-Din Roomi

Mst. Khadija Qureshi

Mr. Muhammad Muzafar Iqbal

Chairman

Chief Executive Officer

Director

Shareholders

Categories

Percentage (%)

Directors, Chief Executive Officer, & their spouse & minor children

Associated Companies, Undertakings & related parties

NIT & ICP

Banks, Development Financial Institutions, Non-Banking Financial Institutions

Joint Stock Companies

Insurance Companies

Modarabas & Mutual Funds

General Public

42.43

5.12

0.20

0.07

1.25

52.93

Associates

A. Subsidiary

None

B. Associated Companies

(1) Masood Spinning Mills Limited, Pakistan.

(2) Masood Fabrics Limited, Pakistan.

(3) Roomi Fabrics Limited, Pakistan.

(4) Roomi Enterprises (Pvt) Limited, Pakistan.

(5) Khawaja Enterprises (Pvt) Limited, Pakistan.

(6) Khawaja Tanneries (Pvt) Limited, Pakistan.

(7) Ghousia Agricultural & Fruit Farms, Pakistan.

Business Activities

Subject Company is engaged in manufacturing & sale of yarn, grey cloth and generation of Electricity.

Its import Textile Raw Materials, Textile Machineries through D/A, D/P basis.

It sells its products to its domestic customers including Buying Agencies, Trading Companies, International Buyers.

Its exporting countries are European & Far East Countries.

Its importing countries are Japan, China, Korea, Taiwan, Thailand, Hong Kong & European Countries

Its major customers are reputable companies, Domestic & Worldwide.

Subject employs about 2,049 persons in its set up.

Annual Sales Volume

Years

In Pak Rupees

2014

2015

15,475,222,284/-

13,759,434,489/-

Plant Capacity & Production

Description

2014

2013

Yarn

Number of spindles installed

Number of spindles – shift worked

Production capacity at 20’s count

1,093 shifts (2013: 1,092 shifts) (Kgs.)

Actual production converted into 20’s count (Kgs.)

Cloth

Number of looms installed

Number of looms-shifts worked

Installed capacity at 60 picks

1,094 shifts (2010: 1,093 shifts) Sq.Mtrs

Actual production converted into 60 picks

Power House

Number of generators installed

Number of shifts worked

Generation capacity in Mega Watt

Actual generation in Mega Watts

107,760

109,598,857

37,284,948

36,882,663

100

109,500

22,717,499

19,857,366

1,093

107,760

112,312,162

38,208,000

35,875,401

100

109,500

22,198,545

19,974,251

1,093

Bankers

(1) MCB Bank Limited, Pakistan.

(2) United Bank Limited, Pakistan.

(3) Habib Bank Limited, Pakistan.

(4) Allied Bank Limited, Pakistan.

(5) Bank Al-Habib Limited, Pakistan.

(6) Meezan Bank Limited, Pakistan.

(7) National Bank of Pakistan.

(8) Bank Alfalah Limited, Pakistan.

Memberships

· Multan Chamber of Commerce & Industry.(MCCI)

· All Pakistan Textile Mills Association.(APTMA)

Foreign Exchange Rates

Currency	Unit	Pakistani Rupee
US Dollar	1	Rs. 105.55
UK Pound	1	Rs. 162.00
Euro	1	Rs. 114.50

Comments

Mahmood Group enjoys good reputation in Pakistan. Directors of the Company are reported as qualified, experienced and resourceful businessmen. Payments are usually correct and as per commitments. Subject can be considered for normal business dealings at usual trade terms and conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.66.14
UK Pound	1	Rs.100.55
Euro	1	Rs.71.26

INFORMATION DETAILS

Analysis Done by :	KAR

Report Prepared by :	NIT

RATING EXPLANATIONS

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
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
<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%)

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