3decades

MIRA INFORM REPORT

Report No. :	485490
Report Date :	11.01.2018

IDENTIFICATION DETAILS

Name :	GUL AHMED TEXTILE MILLS LIMITED

Registered Office :	Plot No. 82, Main National Highway, Landhi, Karachi

Country :	Pakistan

Financials (as on) :	30.06.2016

Year of Establishment :	1953

Com. Reg. No.:	0000586

Legal Form :	Public Limited Company

Line of Business :	Manufacture and Sale of Textile Products.

No. of Employees :	10,000 – 12,700

RATING & COMMENTS

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

MIRA’s Rating :

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

Status :	Good

Payment Behaviour :	Slow and 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

(30.06.2017)

Current Rating

(30.09.2017)

Pakistan

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 slow growth and underdevelopment in Pakistan. Pakistan has a large English-speaking population. Nevertheless, 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 most 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 6.1% in 2016, 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 2016. Low global oil prices in 2016 contributed to a narrowing current account deficit and lower inflation. Remittances from overseas workers continued to be a key revenue source, also mitigating the impact of the lack of foreign investment and a growing trade deficit on the country’s current account.

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,” a $46 billion investment program targeted towards the energy sector and other infrastructure projects that Islamabad and Beijing had agreed on in early 2013.

Source : CIA

Company Name

Business Name

GUL AHMED TEXTILE MILLS LIMITED

Full Address

Registered Address

Plot No. 82, Main National Highway, Landhi, Karachi, Pakistan

Tel #	92 (21) 111-485-485, 35082626, 35015702
Fax #	92 (21) 35082625
Email	gulahmed@gulahmed.com

Mills Location

Landhi Industrial Area,

Karachi, Pakistan

Short Description Of Business

a.	Nature of Business	Engaged in the manufacture and sale of textile products
b.	Year Established	1953
c.	Registration #	0000586

Auditors

Kreston Hyder Bhimji & Co.

(Chartered Accountants)

Legal Status

Gul Ahmed Textile Mills Limited is a public limited Company incorporated in Pakistan, with its shares quoted at Pakistan Stock Exchange

Details of Chief Executive / Directors

Names

Designation

Mr. Mohomed Bashir

Mr. Zain Bashir

Mr. Mohammed Zaki Bashir

Mr. Ziad Bashir

Mr. S.M. Nadim Shafiqullah

Dr. Amjad Waheed

Mr. Adnan Afridi

Chairman & Chief Executive

Director

Shareholders

Categories

Shareholding (%)

Individuals

Investment Companies & Mutual Funds

Insurance Companies

Joint Stock Companies

Modaraba Companies

Financial Institutions

Foreign Investors

Charitable Institutions

Government Departments

7.68

5.96

3.25

69.88

0.01

0.38

12.75

0.01

0.08

Associated Companies

(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.

Business Activities

Engaged in the manufacture and sale of textile products

Number of Employees

10,000 – 12,700

Trade Suppliers (Foreign)

Subject import globally from Companies belongs to European Countries, Korea, China, Singapore, Taiwan, Japan, U.S.A. & U.K. Its global trade suppliers are Companies related to Textile Raw Materials, Machineries

Capacity And Production

2016 2015

(Rupees 000s)

Capacity Production Capacity Production

Spinning (Kgs)

(20 Counts converted) 48,237 32,440 46,970 33,929

Weaving (Sq. Meters) 159,205 111,940 159,205 103,461

(50 Picks converted)

Shifts 3 shifts 3 shifts

Production is lower due to variation in production mix and various technical factors.

Customers

Major customers are Buying Agencies, Retail & Wholesale Traders, Distribution Companies, International Buyers etc

Bankers

(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.

(17) Samba Bank Limited, Pakistan.

(18) Soneri Bank Limited, Pakistan.

Financial Position

Sound

Future Outlook

In today’s highly competitive global environment, the textile sector needs to upgrade its supply chain, improve productivity and maximize value-addition which will require supportive textile policy from the Government to be able to compete. We hope that the energy situation will improve in the country and policy implementation will also be ensured by the Government. To promote sustainable economic growth, structural reforms are needed to avert risks to the economic outlook in the long-term. Lower tax to GDP ratio, documenting the economy, reducing unemployment, resolving energy crisis and loss making public sector entities are the major challenges. Steep decline in oil prices, improved credit rating from international rating agencies and fall in inflation and discount rates have developed positive business sentiments. The Government should capitalize on the opportunity and drive towards comprehensive economic growth. One of the major drivers is the LSM sector. A well thought out long-term policy and the commitment to implement it are needed to remove structural bottlenecks of the sectors.

Memberships

· All Pakistan Textile Mills Association.(APTMA)

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

· Karachi Chamber of Commerce & Industry.(KCCI)

Comments

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. 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 63.83
UK Pound	1	INR 86.28
Euro	1	INR 76.13
PKR	1	INR 0.58

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

INFORMATION DETAILS

Analysis Done by :	DIV

Report Prepared by :	TRU

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

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.