Karachi: The Pakistan Credit Rating Agency (PACRA) recently announced that it will maintain the entity ratings of Jhulay Lal Parboiled Rice Mill, a key player in Pakistan's rice industry. This decision comes as the sector grapples with global economic uncertainties while maintaining its significant contribution to the country's agricultural and export economy.
In FY25, Pakistan's rice industry contributed approximately 10.5% to the nation’s total export earnings, exporting an estimated 5.8 million metric tons. Non-basmati rice varieties made up over 85% of these exports, with basmati rice exports remaining steady at 0.8 million metric tons. The industry's established position in global markets continues to support sustained international demand.
Jhulay Lal Parboiled Rice Mill reported total revenues of approximately PKR 24.05 billion for FY25. Exports accounted for PKR 20.57 billion, nearly 86% of the company's total revenue, highlighting a strong export orientation. Although this marks a decline from the FY24 revenue of roughly PKR 35.02 billion due to exceptional market conditions, the company's FY25 performance reflects its adaptability to normalizing demand while maintaining a robust revenue base.
The revenue mix of Jhulay Lal indicates limited diversification beyond rice. Soya bean products contributed approximately PKR 3.03 billion, or 13% of total revenues, with local byproducts accounting for about 2%. These figures suggest gradual steps toward broadening the product portfolio.
Operationally, the company has maintained efficiency across its processing facilities, optimizing capacity utilization and leveraging strategically located infrastructure to meet domestic and international demand. In FY25, Jhulay Lal utilized around PKR 2.4 billion of its available credit lines totaling about PKR 7.3 billion, ensuring adequate liquidity and financial flexibility to manage working capital and market volatility.
The ratings issued by PACRA are dependent upon sustaining business volumes amid current economic challenges. As the global economy faces distress, maintaining business sustainability is crucial for exporters. Meanwhile, upholding a stable financial risk profile with a focus on working capital management remains essential for the company's ratings.
Jhulay Lal's strong export focus, prudent leverage profile, and efforts towards diversification position it well to navigate input cost pressures and support sustainable growth and revenue stability in the face of global economic challenges.