MIRA INFORM REPORT

Report No. :	501958
Report Date :	10.04.2018

IDENTIFICATION DETAILS

Name :	NISHAT (CHUNIAN) LIMITED
Registered Office :	31-Q, Gulberg-II, Lahore
Country :	Pakistan
Financials (as on) :	30.06.2017
Date of Incorporation :	1990
Com. Reg. No.:	0021135
Legal Form :	Public Limited Company
Line of Business :	Subject is engaged in business of spinning, weaving, dyeing, stitching, processing, doubling, sizing, buying, selling and otherwise dealing in yarn, fabric and made-ups made from raw cotton, synthetic fibre and cloth and to generate electricity for internal use
No. of Employees :	About 6,670

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

A

Credit Rating	Explanation	Rating Comments
A	Acceptable Risk	Business dealings permissible with moderate risk of default

Status :	Satisfactory
Payment Behaviour :	Slow & Delayed
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

Country Name	Previous Rating (30.09.2017)	Current Rating (31.12.2017)
Pakistan	B1	B1

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	D

PAKISTAN - ECONOMIC OVERVIEW

Decades of internal political disputes and low levels of foreign investment have led to underdevelopment in Pakistan. Pakistan has a large English-speaking population. A challenging security environment, electricity shortages, and a burdensome investment climate have deterred investors. Agriculture accounts for one-fifth of output and two-fifths of employment. Textiles and apparel account for more than half of Pakistan's export earnings; Pakistan's failure to diversify its exports has left the country vulnerable to shifts in world demand. Pakistan’s GDP growth has gradually increased since 2012. Official unemployment was 6% in 2017, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Human development continues to lag behind most of the region.

In 2013, Pakistan embarked on a $6.3 billion IMF Extended Fund Facility, which focused on reducing energy shortages, stabilizing public finances, increasing revenue collection, and improving its balance of payments position. The program concluded in September 2016. Although Pakistan missed several structural reform criteria, it restored macroeconomic stability, improved its credit rating, and boosted growth. The Pakistani rupee, after heavy depreciation in 2013, remained relatively stable against the US dollar in 2015-17. Balance of payments concerns have reemerged, however, as a result of increased imports and declining remittances.

Pakistan must continue to address several longstanding issues, including expanding investment in education and healthcare, adapting to the effects of climate change and natural disasters, improving the country’s business environment, reducing dependence on foreign donors, and widening the country’s tax base. Given demographic challenges, Pakistan’s leadership will be pressed to implement economic reforms, promote further development of the energy sector, and attract foreign investment to support sufficient economic growth necessary to employ its growing and rapidly urbanizing population, much of which is under the age of 25.

In an effort to boost development, Pakistan and China are implementing the “China-Pakistan Economic Corridor,” with $60 billion in investments targeted towards energy and other infrastructure projects. Pakistan believes CPEC investments will enable growth rates of over 6% of GDP by laying the groundwork for increased exports. CPEC-related obligations, however, have raised IMF concern that capital outflows that will begin to increase in 2020.

Source : CIA

Business Name

NISHAT (CHUNIAN) LIMITED

Full Address

Registered Address

31-Q, Gulberg-II, Lahore, Pakistan

Tel #	92 (42) 35761730 – 39
Fax #	92 (42) 35878696 – 97

Short Description Of Business

a.	Nature of Business	Engaged in business of spinning, weaving, dyeing, stitching, processing, doubling, sizing, buying, selling and otherwise dealing in yarn, fabric and made-ups made from raw cotton, synthetic fibre and cloth and to generate electricity for internal use
b.	Year Established	1990
c.	Registration No.	0021135

Mills Location

Spinning 1, 4 & 5
49th Kilometre, Multan Road,
Bhai Pheru, Tehsil Chunian,
District Kasur.

Spinning 2, 3 & Weaving
49th Kilometre, Multan Road,
Kamogal, Tehsil Pattoki,
District Kasur
Dyeing & Printing
4th Kilometre, Manga Road,
Raiwind.

Auditors

Riaz Ahmad & Company

(Chartered Accountants)

Legal Status

Public Limited Company (Listed at stock exchange of Pakistan)

Details of Management

Names	Designation
Ms. Farhat Saleem Mr. Shahzad Saleem Mr. Zain Shahzad Mr. Aftab Ahmad Khan Mr. M. Imran Rafiq Mr. Muhammad Ali Zeb Mr. Kamran Rasool	Chairperson Chief Executive Director Director Director Director Director

Shareholders

Categories	Percentage (%)
Directors, CEO and their spouse and minor children Executives Associated Companies, Undertakings & related parties Public Sector Companies & Corporations NIT & IDBP Banks, Development Financial Institutions & Non Banking Financial Institutions Insurance Companies Modarbas & Mutual Funds Joint Stock Companies Others General Public	25.51 0.00 16.64 --- 0.00 12.12 1.65 6.67 4.66 0.97 31.78

Associates

A. Subsidiary Companies

(1) Nishat Chunian Power Limited, Pakistan.

(2) Nishat Chunian USA Inc, U.S.A.

(3) NC Electric Company Limited, Pakistan.

(4) NC Entertainment (Private) Limited, Pakistan.

B. Associated Companies

(1) Nishat Mills Limited, Pakistan.

(2) MCB Bank Limited, Pakistan.

(3) Nishat Power Limited, Pakistan.

(4) Lalpir Power Limited, Pakistan.

(5) Nishat Paper Products Company Limited, Pakistan.

(6) Security General Insurance Company Limited, Pakistan.

(7) Nishat Hotels & Properties Limited, Pakistan.

(8) Nishat (Aziz Avenue) Hotels & Properties Limited, Pakistan.

(9) Nishat (Raiwind) Hotels & Properties Limited, Pakistan.

(10) Nishat (Gulberg) Hotels & Properties Limited, Pakistan.

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

(12) Nishat Automobiles (Pvt) Limited, Pakistan.

(13) Nishat Agriculture Farming (Pvt) Limited, Pakistan.

(14) Nishat Developers (Pvt) Limited, Pakistan.

(15) Pakistan Aviators & Aviation (Pvt) Limited, Pakistan.

(16) Nishat Dairy (Pvt) Limited, Pakistan.

(17) Nishat Farm Supplies Limited, Pakistan.

(18) Nishat Spinning (Pvt) Limited, Pakistan.

(19) MCB Financial Services Limited, Pakistan.

(20) Adamjee Life Assurance Company Limited, Pakistan.

(21) Mnet Services (Pvt) Limited, Pakistan.

(22) Euronet Pakistan (Pvt) Limited, Pakistan.

(23) Adamjee Insurance Company Limited, Pakistan.

(24) Nishat Energy Limited, Pakistan.

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

(26) Nishat Real Estate Development (Pvt) Limited, Pakistan.

(27) D.G. Khan Cement Company Limited, Pakistan.

Business Activities

Subject Company is engaged in business of spinning, weaving, dyeing, stitching, processing, doubling, sizing, buying, selling and otherwise dealing in yarn, fabric and made-ups made from raw cotton, synthetic fibre and cloth and to generate electricity for internal use.

Its mainly import Textile Raw Materials, Textile Machineries through L/C, D/P basis.

It sells its product through cash / credit term basis to its domestic customers.

Its major customers are Buying Agencies, Distributors, Retailers, International Buyers etc.

Subject operates from caption leased office & factory premises Sq.ft situated at commercial & industrial centers of Lahore & Punjab.

Subject employs about 6,670 persons in its set up.

Annual Sales Volume

Years	In Pak Rupees
2014 2015 2016 2017	22,799,758,141/- 23,780,454,796/- 25,799,121,553/- 29,815,994,272/-

Plant Capacity & Actual Production

Production Capacity & actual production is enclosed in separate file in PDF format

Customers (Foreign)

Major customers are Buying Agencies, Distributors, Retailers, International Buyers etc

Bankers

(1) Faysal Bank Limited, Pakistan.

(2) Silk Bank Limited, Pakistan.

(3) Albaraka Islamic Bank B.S.C. (E.C).

(4) Meezan Bank Limited, Pakistan.

(5) Allied Bank of Pakistan Limited, Pakistan.

(6) National Bank of Pakistan, Pakistan.

(7) Askari Bank Limited, Pakistan.

(8) Bank Alfalah Limited, Pakistan.

(9) Standard Chartered Bank, Pakistan.

(10) Citibank N.A., Pakistan.

(11) The Bank of Punjab, Pakistan.

(12) HSBC Bank Middle East Limited, Pakistan.

(13) Deutsche Bank A.G., Pakistan.

(14) Soneri Bank Limited, Pakistan.

(15) Habib Bank Limited, Pakistan.

(16) United Bank Limited, Pakistan.

(17) Habib Metropolitan Bank Limited, Pakistan.

Future Outlook

In order to cater to increased sales, Company’s plan to add a modern mercerizing machine, a continuous washing plant and a high performance stenter in its dyeing and printing plant. This will help in increasing the plant capacity by 15%. In the stitching plant, it also had planning to add to its embroidery capacity as well as the introduction of automated cutting and packing machines in order to increase the efficiency of these departments as well as help reduce the overall cost.

Memberships

All Pakistan Textile Mills Association.(APTMA)

Karachi Chamber of Commerce & Industry.(KCCI)

Federation Pakistan Chamber of Commerce & Industry.(FPCCI)

Comments

Mansha Group enjoys excellent credibility in Pakistan as well as in abroad. Directors of the Company are reported as qualified, experienced and resourceful businessmen. Payments are slow & delayed. In view of current disturbed economic and political situation, we would advise to deal with all the business in Pakistan with some caution.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 64.93
UK Pound	1	INR 91.50
Euro	1	INR 79.69
PKR	1	INR 0.56

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	NIS
Report Prepared by :	TPT

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

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 are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

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.