Press Release
VIS Reaffirms Entity Rating of Premium Textile Mills Limited
Karachi, July 22 2026: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Premium Textile Mills Limited (‘PRET’ or the ‘Company’) at ‘A-/A2’ (Single A minus / A two). Medium to long term rating of 'A-' indicates good credit quality; Protection factors are adequate. Risk factors may vary with possible changes in the economy. Short term rating of 'A2' indicates good likelihood of timely repayment of short-term obligations with sound short-term liquidity factors. Outlook on assigned ratings is ‘Stable’. Previous Rating action was announced on June 03 2025.
PRET was incorporated in Pakistan in 1987 as a public limited company and is listed on Pakistan Stock Exchange Limited. The principal activity of the Company is manufacturing and sale of socks, cotton and polyester yarn. The Company’s head office is located in Karachi while its manufacturing facilities are located in Nooriabad.
The assigned ratings incorporate PRET's strong operational performance, sustained capacity utilization, and continued expansion of its value-added socks segment. Business risk is supported by the Company's presence across both domestic and export markets. Although yarn continues to dominate the revenue mix, the increasing contribution from the higher-margin socks segment is enhancing revenue diversification and is expected to strengthen further with planned capacity expansions.
Liquidity and debt coverage metrics remain adequate, albeit constrained by elevated working capital requirements and the resultant reliance on short-term borrowings, which continues to exert pressure on finance costs. The capitalization profile remains leveraged, reflecting debt-funded expansionary capex aimed at enhancing diversification and operational efficiency. Going forward, management intends to finance capital expenditure from internal resources and focus on deleveraging the balance sheet. Accordingly, sustained improvement in capitalization metrics will remain an important rating consideration.
For further information on this ratings announcement, please contact on 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
VIS Rating Criteria: Industrial Corporates
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf