AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Faisalabad: The Pakistan Credit Rating Agency Limited (PACRA) has maintained the debt instrument rating for Masood Textile Mills Limited’s PKR 2 billion Sukuk, maturing in September 2024. This rating reflects the company’s robust business profile in value-added textile production.
Masood Textile Mills (MTM) is a vertically integrated textile manufacturer, covering the entire textile value chain from spinning and knitting to apparel manufacturing. The company is known for its state-of-the-art facilities and quality standards that meet international customer demands.
MTM’s competitive advantage lies in its precision in production and design innovation, allowing it to deliver high-quality garments. Its business stability is supported by partnerships with globally recognized brands, including JCPenney, Hugo Boss, and Zara.
Financially, MTM has shown improvement with a profit after tax of PKR 661.7 million over the last two quarters, facilitated by a stabilized supply chain and reduced policy rates. However, the company faces challenges with its highly leveraged capital structure and stretched working capital management.
The company’s financial risk profile remains adequate, with recent sukuk profit payments totaling PKR 62.03 million made in March 2025. The next payment is due in June 2025, with principal redemption starting in September 2025.
The sukuk’s rating captures the security structure’s strength, primarily through the FPA mechanism, highlighting the importance of managing finance costs effectively to ensure growth.