Press Release
VIS Updates Outlook on Entity Ratings of Archroma Pakistan Limited
Karachi, January 01, 2026: VIS Credit Rating Company Limited (VIS) maintains entity ratings of Archroma Pakistan Limited (‘’APL’’ or ‘’the Company’’) at 'AA/A1' (Double AA/A One). Outlook on the assigned ratings has been revised from ‘Negative’ to ‘Stable’. The medium to long-term rating ‘reflects high credit quality, strong protection factors, and moderate risk but may vary slightly because of economic conditions. Short-term rating of 'A1’ indicates strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Previous Rating action was announced on September 03, 2024.
APL incorporated in Pakistan as a public limited company and is publicly listed on the Pakistan Stock Exchange Limited (PSX). The Company's registered office is in Karachi. APL is a subsidiary of Archroma Textiles GmbH, based in Pratteln, Switzerland, which holds 75% equity stake in the Company. APL's operations include the manufacturing, importing, and distribution of chemicals, dyestuffs, coatings, adhesives, and sealants for various industries such as textiles, homecare, personal care, leather, paper, packaging, coatings and construction. The Company also serves as an indenting agent. Its manufacturing facilities are situated at Petaro Road, Jamshoro, and Landhi Industrial Area, Karachi, while its corporate and sales offices are located in Korangi, Karachi, Thokar Niaz Baig, Lahore and Amin Town, Faisalabad, respectively.
Assigned ratings reflect notable improvement in Archroma’s operational performance, supported by higher production, better process efficiency, and cost optimization. Despite pressure from energy costs and competitive pricing, profitability strengthened due to improved utilization and disciplined financial management. Working capital remained well controlled, with timely collections and optimized inventories improving liquidity and reducing short-term borrowing. Lower finance costs and positive operating cash flows further enhanced debt-servicing capacity. Business risk remains elevated due to the Company’s exposure to the cyclical textile sector and its reliance on imported raw materials. However, the risk is partially mitigated by a diversified product portfolio, stable demand from the packaging segment and expanding applications in home-care, personal-care, and industrial chemicals. Ongoing investment in sustainable and compliant product lines further enhances the Company’s resilience amid evolving regulatory requirements. Governance and internal controls remain strong, backed by an experienced Board, an independent internal audit function aligned with global frameworks, and integration with parent-group systems that enhances transparency and reporting quality.
For further information on this ratings announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable 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