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Lahore, August 16, 2023 (PPI-OT): The rating reflects the prominent position of Ghani Chemical Industries Limited (GCIL) in the manufacturing, sale, and trading of medical and industrial gases and chemicals. These gases find diverse applications across various industries encompassing medical, chemical processes, metal fabrication, food processing, oil and gas exploration, and many more. With the installation of dedicated gas capacities now, the product portfolio has stabilized along the demand yield curve, indicating a more balanced and consistent state in the industry.
The demand from the steel, automotive, and shipbreaking industries remained weak due to the country’s macroeconomic challenges. In line with its commitment to expanding and strengthening its operations, the board of directors of GCIL has merged G3 Technologies Limited with/into GCIL and successfully achieved its objective of getting listed on the Pakistan Stock Exchange (PSX). During 9MFY23, the topline of the company declined by ~0.7% as compared to the same period last year however, margins also showed dilution at all levels due to macroeconomic turbulence which resulted in reduced demand by large-scale manufacturing. All four plants of Ghani Chemical Industries Limited are currently operational and overall capacity utilization stood at ~65%. Due to reduced demand from one of the renowned customers, the company’s dedicated plant was under-utilized.
The ratings are dependent on the Company’s ability to effectively utilize enhanced capacities. At the same time, management of financial risk, particularly debt coverages, remains important, wherein any further deterioration would have negative implications for the ratings.
For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com
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