Press Release
VIS Reaffirms Entity Ratings of Lucky Cement Limited
Karachi, February 24, 2026: VIS Credit Rating Company Limited (VIS) reaffirms entity ratings of Lucky Cement Limited (LCL’, ‘LUCK’ or ‘the Company’) at 'AA+/A1+' (Double A plus/A One plus) with a “Stable” outlook. Medium to long term rating of ‘AA+' indicates high credit quality; Protection factors are strong. Risk is modest but may vary slightly from time to time because of economic conditions. Short term rating of 'A1+' indicates strongest likelihood of timely repayment of short-term obligations with outstanding liquidity factors. Previous rating action was announced on November 8, 2024.
Incorporated in Pakistan in 1993, Lucky Cement Limited (LCL) is a listed entity engaged in the manufacturing and sale of cement and clinker. The Company operates manufacturing plants in Khyber Pakhtunkhwa and Karachi and is part of the Yunus Brother Group (YBG), a diversified conglomerate with interests spanning cement, textiles, power generation, chemicals, automobiles, mobile phone manufacturing, pharmaceuticals, healthcare, real estate, entertainment, mineral exploration particularly copper and gold mining, food and commodities.
The ratings reflect LCL’s strong cash flows, professional management, and robust sponsor profile, supported by group-level diversification and operational synergies. These strengths offset the cement sector’s medium business risk arising from cyclical demand, exchange rate exposure due to imported coal, and energy cost sensitivity. The industry is characterized by high entry barriers, an oligopolistic structure, and performance closely linked to macroeconomic conditions and PSDP allocation driven demand. The ratings also reflect LCL’s strong financial profile. Profitability improved with higher dispatch volumes from the new Pezu plant line and increased dividend income from subsidiaries. Liquidity remains robust, supported by healthy cash balances and strong liquidity metrics, while conservative gearing and low leverage underpin solid debt-servicing capacity. LCL generates around 55% of its power from renewable sources, enhancing sustainability and cost efficiency. Additionally, UTIS (UC3) technology implemented at two Karachi plant lines has reduced coal consumption and optimized clinker output, with plans to extend it to the remaining lines.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Corporate Rating
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf