Press Release
VIS Assigns Initial Entity Ratings of Weaves Pakistan (SMC–Private) Limited (Formerly Khaadi Pakistan (SMC-Private) Limited
Karachi, August 08, 2025: VIS Credit Rating Company Limited has assigned initial entity ratings of Weaves Pakistan (SMC–Private) Limited (‘WPL’) at 'A+/A1' (Single A Plus/A One). 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 ‘A1’ indicates strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Outlook on the assigned ratings is ‘Stable’.
WPL, incorporated in 2015 as a single-member company, changed its name from Khaadi Pakistan (SMC-Private) Limited in September 2024. It is a wholly owned subsidiary of Weaves Corporation Limited and operates under the retail brand name ‘Khaadi’. The Company is engaged in the design, marketing, distribution and retail of textile products and related accessories. Its registered office is located at Dolmen City, Clifton, Karachi. As of the reporting date, WPL operates 36 retail outlets across Pakistan, along with an international presence comprising of 5 stores in the UK, 3 in the UAE and 2 in the USA.
Pakistani textile retail sector remains a vital component of the broader textile industry, catering to both domestic consumers and the overseas Pakistani diaspora through a mix of physical and online channels. Demand is driven by demographic growth, urbanization and rising preference for ready-to-wear (RTW) apparel, though high interest rates and subdued disposable incomes continue to impact purchasing power. Retailers face structural challenges, including high fixed costs, seasonal sales concentration and margin pressures from energy tariffs, wage hikes and exchange rate volatility. Operational risks stem from significant working capital needs, inventory management and dependence on short-term financing. Nevertheless, strong brands with omni-channel presence and integrated supply chains exhibit greater resilience. As per Statista, Pakistan’s apparel market is projected at USD 5.66 billion in 2025, with a 2.29% decline CAGR (2025-2029). Women’s apparel is expected to contribute USD 2.37 billion, with recovery potential through sustainability and efficiency.
The assigned ratings reflect WPL’s established market position in Pakistan’s retail fashion industry, supported by strong brand equity, a diversified product portfolio and expanding international presence. WPL benefits from continuous design innovation and a strategic transformation of conventional outlets into Experience Hubs to enhance customer engagement and store productivity. The sector remains exposed to macroeconomic volatility, evolving fashion trends and competitive pressures, WPL’s growing traction in the RTW segment alongside its core unstitched category, supports revenue diversification and margin improvement.
The ratings also incorporate the institutional support stemming from the equity investment by the International Finance Corporation in WPL’s parent company, Weaves Corporation Limited. This investment has strengthened governance standards and bolstered the group’s financial risk profile. Ratings remain underpinned on sustained growth and operational efficiencies, alongside continued improvement in liquidity and leverage 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