Press Release
VIS Reaffirms Entity Ratings of Kausar Ghee Mills (Pvt.) Limited
Karachi, April 27, 2026: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Kausar Ghee Mills (Pvt.) Limited (“KGML” or “the Company”) at ‘A/A1’ (Single A /A One). The medium to long-term rating of ‘A’ denotes 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 February 25, 2025.
KGML, established in 1992, is involved in the manufacturing of Vegetable Ghee, Cooking Oil, and allied products. KGML is a family-owned business concern, with the Board of Directors comprising eight directors, all being members of the sponsoring family. The Company is associated with Kausar Group of Companies, having business stake in various sectors involving edible oils, poultry, feed and rice processing.
Assigned rating reflects KGML’s established position in Pakistan’s edible oil and ghee industry, underpinned by a brand presence along with a well-established distribution network. During FY25, the Company’s topline has remained broadly stable, given the inelastic demand nature of its product offerings; strong growth has been observed in topline in 1HFY26.
In terms of profitability, the Company has been able to maintain net margins in the range of 6-7%. Favorable palm oil price movements fed into inventory gains, along with stable exchange rates and the absence of interest-bearing debt supported profitability in the period under review. Given heightened geopolitical tensions and the resultant increase in palm oil prices due to supply chain disruptions, profitability may come under pressure. Nevertheless, the impact is mitigated by the absence of long-term debt on balance sheet and minimal reliance on short-term borrowings for working capital operations. Liquidity profile and debt coverage metrics are considered strong. Given the management’s plans to continue with existing strategy with regards to leveraging, the company is expected to maintain its risk profile. Any changes with regards to the same amidst risks arising from dependence on imports for raw materials and global price movements will be closely tracked by VIS.
For further information on this ratings announcement, please contact on 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