Lahore, September 09, 2021 (PPI-OT):Din Textile, a public listed company is a group concern of Din group – one of the leading business groups established in 1954 having presence across various sectors including textile, dairy, poultry and real estate. Over the years, since its commencement, the Company has expanded into four units with installed capacity of 123,072 spindles and recently added 144 looms. The spindles and looms are of advanced technology, hence are operationally efficient. The ratings incorporate the Company’s moderate yet improving business profile where the revenue is emanating from two segments – spinning and weaving.

The Company’s product portfolio comprises of combed compact yarn, core spun lycra yarn, slub lycra yarn, dyed yarn, melange yarn, ply yarn, gassed yarn, and bleached cotton web for surgical and cosmetic use. The management is planning to further diversify the revenue stream. During 3QFY21, the Company’s revenue grew by 24% (3QFY21: PKR 12,395mln; 3QFY20: PKR 9,985mln) due to concerted management efforts towards increased profitability. The Company majorly draws its revenue from local sales with exports fluctuating around 25% of the total revenue. Margins and net income have improved on account of better prices accompanied by higher operational efficiency.

During the period, cashflows have strengthened along with improved coverages. However, the Company has a high-leveraged capital structure. Textile exports of the country recorded a double-digit increase of ~23% for FY21 to stand at USD 15.4bln as compared to USD 12.5bln in FY20 due to an increase in demand for textile products internationally, led by good recovery around the globe post-pandemic.

Going forward, the textile sector’s outlook is expected to stay stable in the medium term where the demand for textile products is expected to increase. The probability of little attrition in demand remains on the horizon attributable to the outbreak of COVID-19 variants. The ratings are dependent on improving business profile under the current economic conditions; and a strong financial profile with healthy coverages. Improving capital structure while growing business profile remains critical for the Company.

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