Press Release
VIS Reaffirms Entity Ratings of Sapphire Textile Mills Limited
Karachi, November 03, 2026: VIS Credit Rating Company Limited (VIS) reaffirms the entity ratings of Sapphire Textile Mills Limited (‘STML’ or ‘the Company’) at ‘A+/A1’ (Single A Plus/A One). Long-term entity rating of ‘A+’ reflects good credit quality; Protection factors are adequate. Risk factors may vary with possible changes in the economy. Short-term rating of ‘A1’ reflects strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on November 03, 2025.
STML is a public limited company incorporated in 1969. The Company operates vertically integrated operations comprising spinning, weaving, dyeing, printing, finishing and stitching, along with home textiles, with manufacturing facilities based in Punjab and Sindh with the registered office located in Karachi. Pakistan’s textile sector continues to experience a structural shift towards value-added manufacturing amid persistent cost pressures and subdued external demand. The sector’s outlook remains cautious, with value-added segments expected to offer relatively stronger earnings prospects than conventional spinning operations.
The assigned ratings reflect the Company’s established position in the textile sector, supported by vertically integrated operations, longstanding export relationships and a diversified customer base. During FY26, STML rationalized spinning capacity at its Kotri unit by discontinuing production from uneconomic spindles in line with its continued shift towards value-added segments. Furthermore, challenging sector conditions weighed on textile operating performance, while the Company’s material investment portfolio provided recurring dividend income, supporting overall profitability. The financial risk profile strengthened during the year, underpinned by an enhanced equity base, broadly stable debt levels, comfortable liquidity and improved debt servicing capacity. Going forward, the continued focus on value-added textiles and recurring dividend income is expected to support the Company’s business and financial profiles. Planned investments in subsidiaries, namely, Sapphire Chemicals (Private) Limited, are expected to be financed through a combination of internal resources and debt, with the overall impact on the Company’s financial risk profile expected to remain moderate.
For further information on this ratings announcement, please contact 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria: Corporates
https://docs.vis.com.pk/Methodologies-2026/Corporate-Rating-2026.pdf
VIS Issue/Issuer Rating Scale
https://vis.com.pk/docs/VISRatingScales.pdf