Press Release
VIS Reaffirms Entity Ratings of Dairyland (Pvt) Limited
Karachi, February 25, 2026 VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Dairyland (Pvt) Limited (‘Dairyland’ or ‘the Company’) at ‘A-/A2’ (Single A Minus/A Two). Medium to long-term 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 ‘A2’ signifies good likelihood of timely repayment of short-term obligations with sound short-term liquidity factors. Outlook on the assigned rating is ‘Positive’. Previous rating action was announced on January 17, 2025.
Dairyland (Private) Limited (DPL), incorporated in 2009, is part of the Akhtar Group of Companies, with majority shareholding held by Akhtar Textile (Pvt.) Limited. The Company operates a dairy farm and a poultry farm, managing a fully integrated “grass-to-glass” value chain through its dairy farm and processing facility in Dhabeji, Sindh, covering herd management, fodder cultivation, milk collection, processing, and packaging. Dairyland markets its products under the well-recognized ‘Dayfresh’ brand, positioned in Pakistan’s value-added and packaged dairy segment.
The assigned ratings reflect Dairyland (Private) Limited’s established position in Pakistan’s organized dairy segment under the ‘Dayfresh’ brand, supported by an integrated “grass-to-glass” operating model encompassing dairy farming, processing, and distribution. The ratings also factor in the backing of the Akhtar Group of Companies, a diversified business group with a strong presence in textiles and allied sectors, which provides implicit support in terms of governance depth, financial flexibility, and strategic oversight. Operational performance improved in FY25, with higher capacity utilization, better product mix, and margin expansion driven by efficiency gains and a strategic shift toward higher-margin segments, however, the business risk profile remains constrained by the structurally challenging industry environment. Pakistan’s dairy sector is characterized by low formalization, intense competition from the informal loose-milk market, elevated input and energy costs, and policy-driven pricing pressures, including high GST on packaged milk, which has dampened volume growth and increased market stress. The Company has experienced some moderation in receivable collections and relatively higher working capital requirements, largely reflective of prevailing market conditions.
From a financial risk perspective, capitalization remains manageable despite an increase in borrowings to support capacity expansion and working capital needs. Profitability and cash flow coverage indicators strengthened in FY25, with improved margins, higher funds from operations, and stronger debt service coverage. Liquidity metrics also showed improvement, although elongated cash conversion cycles highlight ongoing working capital intensity. Going forward, the ratings will remain sensitive to the Company’s ability to sustain margin improvements, manage leverage amid planned expansion projects, navigate industry-wide cost and demand pressures, and maintain adequate liquidity and coverage metrics.
For further information on this ratings announcement, please contact at 021-35311861-64 or email at info@vis.com.pk
Applicable Rating Criteria: Corporates:
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf