MIRA INFORM REPORT

 

 

Report No. :

339530

Report Date :

04.09.2015

 

IDENTIFICATION DETAILS

 

Name :

NISHAT MILLS LIMITED

 

 

Registered Office :

Nishat House, 53 A, Lawrence Road, Lahore

 

 

Country :

Pakistan

 

 

Financials (as on) :

2014

 

 

Year of Establishment :

1960

 

 

Com. Reg. No.:

0001053

 

 

Legal Form :

Public Limited Company

 

 

Line of Business :

Subject is engaged in the business of textile manufacturing and of spinning, combing, weaving, bleaching, dyeing, printing, stitching / apparel, buying, selling and otherwise dealing in yarn, linen, cloth and other goods and fabrics made from raw cotton, synthetic fibre and cloth and to generate, accumulate, distribute, supply and sell electricity.

 

 

No. of Employee :

18,197

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

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:

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 – March 31, 2015

 

Country Name

Previous Rating

(31.12.2014)

Current Rating

(31.03.2015)

Pakistan

B1

B1

 

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-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 was 6.6% in 2013, 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. 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 the following two years, 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 3.5% per year from 2008 to 2013. 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

 

 

Company name

                                   

NISHAT MILLS LIMITED

 

 

Full Address       

 

Registered Address

Nishat House, 53 A, Lawrence Road, Lahore, Pakistan

                       

Tel #

92 (42) 36367812, 36367816

Fax #

92 (42) 36367414

 

 

Short Description Of Business

 

a.

Nature of Business      

The Company is engaged in the business of textile manufacturing and of spinning, combing, weaving, bleaching, dyeing, printing, stitching / apparel, buying, selling and otherwise dealing in yarn, linen, cloth and other goods and fabrics made from raw cotton, synthetic fibre and cloth and to generate, accumulate, distribute, supply and sell electricity

b.

Incorporated

1960

c.

Registration No.

0001053

 

 

Head Office

           

Address

7-Main Gulberg, Lahore, Pakistan

Tel #

92 (42) 35716351, 35716359

Fax #

92 (42) 35716349, 50

 

 

Liason Office

           

Address

1st Floor, Karachi Chambers, Hasrat Mohani Road, Karachi, Pakistan

Tel #

92 (21) 32414721, 722, 723

Fax #

92 (21) 32412936

 

 

 

Mills Location

 

(1) Nishatabad, Faisalabad.(Spinning, Processing, Stitching Units & Power Plant)

(2) 12 KM, Faisalabad Road, Sheikhupura.(Weaving Units & Power Plants)

(3) 21 Km, Ferozepur Road, Lahore.(Stitching Unit)        

(4) 5 Km, Nishat Avenue Off 22 Km Ferozepur Road, Lahore.

(5) 20 KM, Sheikhupura Faisalabad Road, Feroze Watwan.(Spinning Unit)

 

 

Auditors

 

Riaz Ahmad & Company

(Chartered Accountants)

 

 

Legal Status

 

Public Limited Company (Listed at stock exchanges of Pakistan)

 

 

Details of Management

                       

Names

 

Designation

Mr. Mian Hassan Mansha

 

Mr. Mian Umer Mansha

 

Mr. Syed Zahid Hussain

 

Mr. Khalid Qadeer Qureshi

 

Ms. Nabiha Shahnawaz Cheema

 

Mr. Maqsood Ahmad

 

Mr. Saeed Ahmad Alvi

Chairman

 

Chief Executive

 

Director

 

Director

 

Director

 

Director

 

Director

 

 

Shareholders                

           

Categories

 

    Percentage (%)

Directors, CEO, their spouses and minor children

 

Associated Companies, Undertakings & related parties

 

NIT & ICP

 

Banks, Development Financial Institutions, Non-Banking Financial Institutions

 

Insurance Companies

 

Modarbas & Mutual Funds

 

General Public

 

Others

 

25.22

 

 

8.97

 

0.06

 

 

 

3.41

 

3.84

 

10.10

 

45.52

 

11.89

 

 

Associates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

 

A.         Subsidiary

                        None                                            

           

B.         Associated Companies

           

(1) D.G. Khan Cement Limited, Pakistan.

(2) Mansha Brothers (Pvt) Limited, Pakistan.

(3) Nishat Chunian Limited, Pakistan.

(4) Umer Fabrics Limited, Pakistan.

(5) MCB Bank Limited, Pakistan.

(6) Genertech Pakistan Limited, Pakistan.

(7) Nishat Finishing Mills.

(8) Nishat Capital Management.

(9) Trust Management Services.

(10) Chunian Fibre.

(11) Nishat Europe.

(12) Newbery Mansha.

(13) D.G. Khan Electric Company.

(14) Gulf Nishat Apparel Limited. (New Company)

(15) Nishat Shuaiba Paper Products Co. Limited.   

(16) Nishat Power Limited, Pakistan.

(17) Nishat USA Incorporation, U.S.A.

(18) Nishat Linen Trading LLC, U.A.E.

(19) Nishat Hospitality (Pvt) Limited, Pakistan.

(20) Nishat Linen (Pvt) Limited, Pakistan.

 

 

Business Activities

 

Engaged in the business of textile manufacturing and of spinning, combing, weaving, bleaching, dyeing, printing, stitching, buying, selling and otherwise dealing in yarn, linen, cloth and other goods and fabrics made from raw cotton, synthetic fibre and cloth, and to generate, accumulate, distribute and supply electricity

 

 

Number of Employees

 

18,197

 

 

Annual Sales Volume

 

Years

In Pak Rupees

2013

2014

52,426,030,000/-

54,444,091,000/-

 

 

Production Capacity

 

Description

2014

(Figures in Thousand)

2013

(Figures in Thousand)

Spinning

 

100 % plant capacity converted to 20s count based on 3 shifts per day for

1,095 shifts (30 June 2012: 1,098 shifts) (Kgs.)

 

Actual production converted to 20s count based on 3 shifts per day for

1,095 shifts (30 June 2012: 1,098 shifts) (Kgs.)

 

Weaving

 

100 % plant capacity at 50 picks based on 3 shifts per day for 1,095 shifts (30 June 2012: 1,098 shifts) (Sq.Mt.)

 

Actual production converted to 50 picks based on 3 shifts per day for 1,095 shifts (30 June 2012: 1,098 shifts) (Sq.Mt.)

 

 

Dyeing and finishing

 

Production capacity for 3 shifts per day for 1,095 shifts (30th June 2012 :

1,098 shifts) (Mt.)

 

Actual production on 3 shifts per day for 1,095 shifts (30th June 2012 : 1,098 shifts) (Mt.)

 

Power Plant

 

Generation capacity (MWH)

Actual generation (MWH)

 

 

 

 

 

 

66,468

 

 

 

 

 

58,225

 

 

 

 

 

 

258,162

 

 

 

 

248,256

 

 

 

 

 

 

 

54,000

 

 

 

49,390

 

 

 

447

287

 

 

 

 

 

 

66,944

 

 

 

 

 

57,823

 

 

 

 

 

 

240,728

 

 

 

 

231,278

 

 

 

 

 

 

 

54,000

 

 

 

52,757

 

 

 

469

297

 

 

Trade Suppliers (Foreign)

 

Various International belongs to China, Korea, Japan, Singapore, U.K. & European Countries

 

 

Bankers

           

(1) Albaraka Bank (Pakistan) Limited, Pakistan.

(2) Allied Bank Limited, Pakistan.

(3) Askari Bank Limited, Pakistan.

(4) Bank Alfalah Limited, Pakistan.

(5) Bank Islami Pakistan Limited, Pakistan.

(6) Barclays Bank PLC, Pakistan.

(7) Burj Bank Limited, Pakistan.

(8) Citibank N.A., Pakistan.

(9) Deutsche Bank AG, Pakistan.

(10) Dubai Islamic Bank Pakistan Limited, Pakistan.

(11) Faysal Bank Limited, Pakistan.

(12) Habib Bank Limited, Pakistan.

(13) Habib Metropolitan Bank Limited, Pakistan.

(14) HSBC Bank Middle East Limited, Pakistan.

(15) JS Bank Limited, Pakistan.

(16) KASB Bank Limited, Pakistan.

(17) Meezan Bank Limited, Pakistan.

(18) National Bank of Pakistan.

(19) NIB Bank Limited, Pakistan.

(20) Samba Bank Limited, Pakistan.

(21) Silk Bank Limited, Pakistan.

(22) Soneri Bank Limited, Pakistan.

(23) Summit Bank Limited, Pakistan.

(24) Standard Chartered Bank (Pakistan) Limited, Pakistan.

(25) The Bank of Punjab, Pakistan.

(26) United Bank Limited, Pakistan.

 

 

Contribution to National Exchequer

 

As an export oriented entity, the Company has earned precious foreign exchange of US $ 409.631 million during the current year. In addition to that, the Company contributed Rs. 1,185 million towards national exchequer by way of income taxes, sales taxes and custom duties etc. the Company is also acting as withholding agent for FBR

 

 

Memberships

 

·         Faisalabad Chamber of Commerce & Industry.(FCCI)

·         Federation Pakistan Chamber of Commerce & Industry.(FPCCI)

 

 

Foreign Exchange Rates

 

Currency

 

Unit

Pakistani Rupee

US Dollar

1

           Rs. 102.65

UK Pound

1

           Rs. 152.50

Euro

1

           Rs. 110.25

 

 

Comments

 

Mansha Group of Companies enjoys excellent credibility in Pakistani as well as in abroad. Directors of the Company are reported as qualified, experienced and resourceful businessmen. Payments are usually correct and as per commitments. Company can be considered for normal business dealings at usual trade terms and conditions.

 

 

FIANCIALS

 

 

Note

2014

2013

 

 

(Rupees in thousand )

EQUITY AND LIABILITIES SHARE

CAPITAL AND RESERVES

Authorized share capital

1,100,000,000 (2013:1,100,000,000) ordinary

shares of Rupees 10 each

 

11,000,000

11,000,000

Issued, subscribed and paid-up share capital

3

3,515,999

3,515,999

Reserves

4

65,073,177

55,401,036

Total equity

 

68,589,176

58,917,035

LIABILITIES

 

 

 

NON-CURRENT LIABILITIES

 

 

 

Long term financing

5

6,431,304

 

3,083,410

Liabilities against assets subject to finance lease

6

-

 

66,322

Deferred income tax liability

7

474,878

 

499,415

 

 

6,906,182

3,649,147

CURRENT LIABILITIES

 

 

 

Trade and other payables

8

4,428,996

 

3,785,501

Accrued mark-up

9

295,054

 

300,755

Short term borrowings

10

14,468,124

 

11,939,028

Current portion of non-current liabilities

11

1,595,652

 

1,310,769

Provision for taxation

 

765,393

 

732,359

 

 

21,553,219

18,068,412

TOTAL LIABILITIES

 

28,459,401

21,717,559

CONTINGENCIES AND COMMITMENTS

12

 

 

TOTAL EQUITY AND LIABILITIES

 

97,048,577

80,634,594

The annexed notes form an integral part of these financial statements.

 

 

 

 

 

 

Note

2014

2013

 

 

(Rupees in thousand )

ASSETS

NON-CURRENT ASSETS

 

 

 

Property, plant and equipment

13

22,964,388

15,530,320

Investment properties

14

386,748

394,745

Long term investments

15

44,771,715

37,378,224

Long term loans

16

102,726

84,997

Long term deposits

17

48,008

41,748

 

 

68,273,585

53,430,034

CURRENT ASSETS

 

 

 

Stores, spare parts and loose tools

18

1,316,479

 

1,285,371

Stock in trade

19

12,752,495

 

10,945,439

Trade debts

20

2,929,054

 

6,243,535

Loans and advances

21

4,184,485

 

1,898,334

Short term deposits and prepayments

22

42,893

 

40,018

Other receivables

23

1,504,538

 

1,019,164

Accrued interest

24

15,172

 

13,550

Short term investments

25

3,227,560

 

4,362,880

Cash and bank balances

26

2,802,316

 

1,128,862

 

 

28,774,992

 

26,937,153

Non-current asset held for sale

27

-

 

267,407

 

 

28,774,992

27,204,560

TOTAL ASSETS

 

97,048,577

80,634,594

 

 

 

Note

2014

2013

 

 

 (Rupees in thousand)

 

 

 

 

SALES

28

54,444,091

52,426,030

COST OF SALES

29

(46,580,317)

(43,381,545)

GROSS PROFIT

 

7,863,774

9,044,485

DISTRIBUTION COST

30

(2,554,627)

 

(2,529,455)

ADMINISTRATIVE EXPENSES

31

(1,032,238)

 

(870,269)

OTHER EXPENSES

32

(344,516)

 

(409,429)

 

 

(3,931,381)

(3,809,153)

 

 

3,932,393

5,235,332

OTHER INCOME

33

3,653,041

2,739,102

PROFIT FROM OPERATIONS

 

7,585,434

7,974,434

FINANCE COST

34

(1,609,882)

(1,617,581)

PROFIT BEFORE TAXATION

 

5,975,552

6,356,853

TAXATION

35

(463,000)

(510,000)

PROFIT AFTER TAXATION

 

5,512,552

5,846,853

EARNINGS PER SHARE - BASIC AND DILUTED (RUPEES)

36

15.68

16.63

 

The annexed notes form an integral part of these financial statements.

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.66.23

UK Pound

1

Rs.101.22

Euro

1

Rs.74.33

 

INFORMATION DETAILS

 

Analysis Done by :

DIV

 

 

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%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.