Press Release
VIS Assigns Initial Entity Rating to Roomi Poultry Limited
Karachi, July 21, 2025: VIS Credit Rating Company Limited (VIS) has assigned initial medium to long-term ratings to Roomi Poultry Limited (“RPL” or “the Company”) of ‘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' indicates a good likelihood of timely repayment of short-term obligations with sound short-term liquidity factors. Outlook on the assigned rating is ‘Stable’.
RPL is the parent company in Iqbal Group of Companies which is operated as an integrated poultry enterprise engaged in feed manufacturing, egg production, and egg trading. The Company also recently set up three subsidiaries, First Avilac Solution Pvt. Limited, is a wholly owned subsidiary which deals in trading of imported feed additives. Second FieldFusion Corp. Pvt Limited is also a wholly owned subsidiary which deals in the export of agri-based products. Third Poultry Links Pvt. Limited is a subsidiary with 65% equity interest which deals in Broiler Farming, breeder and broiler allied businesses. Headquartered in Kabirwala, Punjab, RPL is developing a diversified business structure to support operations across multiple verticals within the poultry value chain.
Assigned ratings incorporate the business risk profile of Pakistan’s poultry sector, which is supported by steady demand fundamentals but remains exposed to volatility in input costs, fragmented market structures, and regulatory interventions. The sector’s reliance on imported soybean for feed production introduces foreign exchange exposure, though partially offset by the domestic availability of maize. High competition, limited pricing power, and inconsistent policy interventions—such as import restrictions and pricing caps—continue to affect operational dynamics. Regulatory unpredictability remains a moderate constraint, especially in relation to taxation and pricing policies. Sector fragmentation limits margin flexibility, while high working capital requirements, elevated energy costs, and exposure to interest rate movements further weigh on sector stability.
The ratings draw support from the Company’s strategic expansion into the feed segment has supported a gradual improvement in operating margins through increased vertical integration and scale efficiencies. These gains have been partially offset by higher interest expenses resulting from elevated borrowing costs, placing pressure on net profitability in recent periods. The capital structure remains reliant on short-term borrowings for working capital needs. While gearing has remained within acceptable limits, overall leverage indicators continue to reflect elevated levels. Capitalization is expected to improve on the back of projected profitability gains in 2025 and an equity injection from a Dutch investor. This is likely to support balance sheet strengthening and improved gearing and leverage metrics. Governance enhancements have also been noted, with the Company’s transition from a private to a public unlisted entity and plans to pursue an Initial Public Offering (IPO) in future. This transition is expected to enhance financial transparency and governance oversight.
Going forward, ratings will remain sensitive to the company’s ability to maintain its capitalization profile, given the ambitious expansion plans with a focus on lowering the leverage.
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