Press Release

VIS Reaffirms Entity Ratings of M. K. Sons (Private) Limited

Karachi, July 11, 2025: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of M. K. Sons (Private) Limited (‘MKS’ or ‘the Company’) at ‘A-/A2’ (Single A Minus/A Two). The medium to long-term entity rating of ‘A-’ reflects good credit quality; Protection factors are adequate. Risk factors may vary with possible changes in the economy. The short-term rating of ‘A2’ indicates good likelihood of timely repayment of short-term obligations with sound short-term liquidity factors. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on June 14, 2024.

MKS was incorporated in 1985 as a private limited company. The registered office and production facilities are located in Faisalabad. The Company’s core line of business includes manufacturing and sales of value-added fabrics, home textile products and denim garments.

The textile sector is grappling with elevated business risks, stemming from high production costs, volatility in demand, ongoing inflationary challenges, and regional competition. The Company has demonstrated resilience under challenging environment, with a notable increase in net sales in FY24 and 10MFY25. Gross margins have remained stable with favorable pricing adjustments offsetting higher production costs while net margin recovered during 10MFY25 after a slight dip in FY24. Despite growth in topline, cash flow coverages remained under stress, while liquidity ratios remained adequate from ratings perspective. Moreover, while gearing remained intact at manageable levels, leverage rose with increase in trade payables.

Looking ahead, the Company is expected to maintain positive sales trajectory, underpinned by a consistent demand for home textiles and made-ups. Sustained improvement in profit margins, recovery in cash flows and achieving projected improvement in capitalization ratios will be key rating drivers, moving forward.

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

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright July 11, 2025 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.