Press Release

VIS Finalizes Short-Term Sukuk 3 (STS-3) Rating of Mahmood Textile Mills Limited

Karachi, January 23, 2026: VIS Credit Rating Company Limited (VIS) has finalized short term rating of Mahmood Textile Mills Limited’s (‘MEHT’, ‘MTML’ or ‘the Company’) Short-term Sukuk 3 (STS-3) rating at ‘A1’ (A One) Short term rating of ‘A1’ reflects strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Previous rating action was announced on January 1, 2026.

MEHT has issued a privately placed Short-Term Sukuk (STS-3) of PKR 4,000 million (inclusive of PKR 1,000 million green shoe option) with 6 months tenure, to finance working capital needs. The issuance date of instrument was January 09, 2026 and the maturity will fall on July 09, 2026. The STS-3 carries single bullet repayment of principal at maturity, with profit payable alongside the principal amount. The profit rate is benchmarked to the three-month Karachi Interbank Offered Rate (KIBOR) plus 45 basis points, fixed on the last working day prior to issuance and applicable for the full tenor. Moreover, the Company’s Short-term Sukuk (STS-2) amounting to PKR 6,000 million is expected to mature at April 17, 2026.

The assigned rating reflects the strong footprint of the Mahmood Group across the textile value chain and related businesses, as well as the security structure supporting the instrument. This includes charge over assets, availability of equivalent working capital lines, buildup of a dedicated payment account (DPA), and the management’s plan to deleverage the books through further sale of investment in Orient Power Company (Private) Limited. Rating remains underpinned by management’s ongoing efforts to strengthen the balance sheet.

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

Instrument Rating:
(https://backupsqlvis.s3.us-west-2.amazonaws.com/Methodologies-2025/IRM-Apr-25.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 January 23, 2026 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.