Press Release
VIS Reaffirms Entity Ratings of JK Sugar Mills (Private) Limited
Karachi, July 31, 2026: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of JK Sugar Mills (Private) Limited (‘JKSML’ or ‘the Company’) at 'A-/A2' (‘Single A Minus/A Two’). Medium to long term rating of 'A-' indicates good credit quality; Protection factors are adequate. Risk factors may vary with possible changes in the economy. Short-term rating of 'A2' suggests good likelihood of timely repayment of short-term obligations with sound short-term liquidity factors. Outlook on the assigned ratings is ‘Stable’. Previous ratings action was announced on June 20, 2025.
JK Sugar Mills (Private) Limited was incorporated in Pakistan in 2017 as a private limited company. The Company is principally engaged in the production and sale of crystalline sugar, along with the commercialization of sugar manufacturing by-products, including bagasse, molasses, and mud. JKSML operates through two manufacturing units: Unit I located in District Khanewal, Punjab, and Unit II situated in District Ghotki, Sindh. The Company’s registered office is located at 61-A, Main Gulberg, Lahore. Effective October 01, 2023, Shamim & Company (Private) Limited was amalgamated with and into JKSML, resulting in the transfer of all assets, liabilities, rights, and obligations to JK Sugar Mills (Private) Limited. Further, on December 30, 2024, the Company disposed of its bottling business assets to Naubahar Bottling Company (Private) Limited.
The assigned ratings reflect the Company’s operating scale in the sugar sector, supported by two manufacturing units in Punjab and Sindh. The amalgamation of Shamim & Company (Private) Limited has enlarged the Company’s asset base, while the disposal of the bottling business has streamlined operations toward sugar and allied by-products. During MY25, revenues increased significantly, supported by higher sugar sales volumes, carryforward inventory, and better selling prices, despite constrained cane availability and subdued recovery levels.
Profitability improved notably in MY25, driven by stronger pricing, lower raw material costs, reduced fuel and power expenses, and lower finance costs. The Company reported profit from continuing operations compared to a sizeable loss in the preceding year, while overall earnings were further supported by discontinued operations. Performance during 1HMY26 remained adequate, with improved crushing operations, better sucrose recovery, and higher sugar prices supporting margins. Capitalization improved at end-MY25 following repayment of borrowings, though leverage increased again in 1HMY26 due to seasonal working capital requirements. Debt coverage remained adequate, while liquidity indicators stayed moderate.
Going forward, the ratings remain sensitive to sugar price trends, export opportunities amid expected surplus production, and the Company’s ability to sustain recovery rates, profitability, and cash flow generation.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk
Applicable Rating Criteria:
Corporate Rating
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf