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MIRA INFORM REPORT
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Report No. : |
508505 |
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Report Date : |
15.05.2018 |
IDENTIFICATION DETAILS
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Name : |
FAZAL CLOTH MILLS LIMITED |
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Registered Office : |
69/7, Abid Majeed Road, Survey No. 248 / 7, Lahore Cantt, Lahore |
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Country : |
Pakistan |
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Financials (as on) : |
30.06.2016 |
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Date of Incorporation : |
1966 |
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Com. Reg. No.: |
0002266 |
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Legal Form : |
Public Limited Company |
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Line of Business : |
Subject is engaged in Manufacture and Sale of Yarn & Fabric |
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No. of Employees : |
About 5,633 |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd
January 2017)
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MIRA’s Rating : |
A |
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Credit Rating |
Explanation |
Rating Comments |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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Status : |
Satisfactory |
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Payment Behaviour : |
Slow & Delayed |
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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
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Country Name |
Previous
Rating (30.09.2017) |
Current Rating (31.12.2017) |
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Pakistan |
B1 |
B1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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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.
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Source
: CIA |
Business
Name
FAZAL CLOTH MILLS LIMITED
Full
Address
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Registered
Address |
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69/7, Abid Majeed Road, Survey No. 248 / 7, Lahore Cantt, Lahore,
Pakistan |
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Tel # |
92 (42) 36684909, +923008631543 |
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Fax # |
92 (42) 36684909 |
Short
Description Of Business
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a. |
Nature of Business |
Engaged in manufacture and sale of Yarn & Fabric |
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b. |
Incorporated |
1966 |
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c. |
Registration No. |
0002266 |
Head
Office
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Address |
129/1, Old Bhawalpur Road, Multan, Pakistan |
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Tel # |
92 (61) 4587632, 4573338 |
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Fax # |
92 (61) 4541832 |
Mills
Location
(1) Fazal Nagar, Jhang Road, Muzaffargarh, Pakistan.
(2) Qadirpur Rawan Bypass, Khanewal Road, Multan, Pakistan.
Auditors
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KPMG Taseer Hadi & Co. (Chartered Accountants) |
Legal
Status
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Public Limited Company (Listed
at stock exchange of Pakistan) |
Details
of Management
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Names |
Designation |
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Mr. Rehman Naseem Mr. Sheikh Naseem Ahmed Mrs. Mahnaz Amir Sheikh Mr. Fazal Ahmad Sheikh Mr. Faisal Ahmed Mr. Fahd Mukhtar Mr. Jamal Nasim |
Chairman Chief Executive Director Director Director Director Director |
Shareholders
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Name |
Shareholding (%) |
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Directors, Spouses & Minor Children Associated Companies, Undertakings & Related Parties Investment Banks / Co., NIT & ICP, Financial Institutions Joint Stock Companies Modarba & Funds Trust Pension Fund Others Individuals |
33.934 55.250 0.012 0.068 5.957 0.001 0.539 0.161 4.078 |
Associates
A. Subsidiary
None
B. Associated
Companies
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(1) Ahmed Fine Textile Mills Limited, Pakistan. (2) Fazal Rehman Fabrics Limited, Pakistan. (3) Amir Fine Exports (Pvt) Limited, Pakistan. |
Business
Activities
Subject Company is engaged in manufacture and sale of Yarn & Fabric.
Its import Textile Raw Materials, Textile Machineries through L/C, D/P basis.
It sale its product through L/C,
D/P basis to its foreign customers.
Its exporting countries are European Countries & Far East Countries.
Its importing countries are China,
Japan, Taiwan, Singapore, Thailand & European Countries.
Its major customers are Buying Agencies, Distribution Companies,
International Buyers etc.
Subject operates from caption leased office & factory premises
situated at commercial & industrial centers of Karachi & Punjab.
Subject employs about 5,633
persons in its set up.
Annual
Sales Volume
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Years |
In Pak Rupees |
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2015 2016 |
25,568,443,177/- 20,615,979,078/- |
Plant
Capacity & Actual Production
2016 2015
Spinning:
Number of spindles installed 229,992 216,792
Number of rotors installed 2,220 2,220
Number of shifts worked
Unit I, II & IV 1,098 1,093
Unit III 1,098 1,094
Subsidiary --- 1,027
Number of spindles - Shifts
worked 252,531,216 235,324,276
Capacity at 20’s count - Kgs 86,958,808 81,051,794
Actual production of all counts -
Kgs 90,259,103 74,609,966
Actual production converted into
20’s count - Kgs 82,805,383 80,014,663
Weaving
Number of looms installed 224 224
Number of looms worked 224 224
Number of shifts worked 1,098 1,095
Standard cloth production
I.M.
49,984,651 49,259,519
Actual cloth production I.M. 45,841,269
43,848,377
Trade
Suppliers (Foreign)
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Subject import globally from Companies belongs to China, Japan, Taiwan, Singapore, Thailand &
European Countries. Its global trade suppliers are Companies related to
Textile Raw Materials, Machineries |
Customers
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Major customers are Buying Agencies,
Distribution Companies, International Buyers etc |
Bankers
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(1) Habib Bank Limited, Pakistan. (2) United Bank Limited, Pakistan. (3) MCB Bank Limited, Pakistan. (4) Askari Bank Limited, Pakistan. (5) Bank Al Habib Limited, Pakistan. (6) National Bank of Pakistan. (7) Soneri Bank Limited, Pakistan. (8) Meezan Bank Limited, Pakistan. (9) Allied Bank Limited, Pakistan. (10) Faysal Bank Limited, Pakistan. (11) Standard Chartered Bank, Pakistan. (12) Bank Alfalah Limited, Pakistan. (13) Dubai Islamic Bank, Pakistan. (14) Silk Bank Limited, Pakistan. (15) Habib Metropolitan Bank Limited, Pakistan. (16) The Bank of Khyber, Pakistan. |
Future
Outlook
Management is happy to report that during the year additional spinning and
weaving capacities of the Company came on line. These have resulted in lower
costs due to economies of scale and improved the product profile of the
Company.
Memberships
APTMA
KCCI
MCCI
FPCCI
Comments
Subject Company enjoys good reputation in Pakistan. Directors are
reported as qualified, experienced and resourceful businessmen. Payments are
usually correct and as per commitments. 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
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 67.32 |
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1 |
INR 91.25 |
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Euro |
1 |
INR 80.50 |
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PKR |
1 |
INR 0.58 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
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DIV |
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Report Prepared
by : |
TPT |
RATING EXPLANATIONS
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Credit Rating |
Explanation |
Rating Comments |
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A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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D |
High Risk |
Business dealing not recommended or on
secured terms only |
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NB |
New Business |
No recommendation can be done due to
business in infancy stage |
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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
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Payment
record
·
Litigation
against the subject
·
Industry
scenario / competitor analysis
·
Supplier
/ Customer / Banker review (wherever available)
This report is issued at
your request without any risk and responsibility on the part of MIRA INFORM
PRIVATE LIMITED (MIPL) or its officials.