Mughal Iron & Steel Industries Limited (“Mughal” or “the Company”) has been listed on the Pakistan Stock Exchange (PSX) since March 2015. The Company’s registered head office is located in Lahore, with its manufacturing facility situated on Sheikhupura Road, approximately 17 kilometers from the city. Additionally, Mughal operates sales centers in Badami Bagh, Lahore. Mughal is primarily engaged in the manufacturing and sale of steel products, including billets, girders, and rebars. In line with its strategic growth objectives, the Company has expanded into the non-ferrous segment, focusing on the export of copper. This diversification has enhanced Mughal’s market footprint and reduced its reliance on the traditional steel sector.

Mughal is predominantly owned by the Mughal family, holding approximately 76% of the Company's shares. The remaining ownership is distributed among financial institutions and the general public. The sponsors of the Company, the Mughal family, bring over five decades of experience in the steel and allied industries, providing a strong foundation of expertise and leadership in the business.

MIughal is governed by a nine-member Board of Directors, comprising a majority of six members from the sponsoring Mughal family, including the Chairman and Chief Executive Officer. The remaining three positions are held by independent directors, while the board also includes three non-executive directors, ensuring a well-balanced and diverse governance structure. Mr. Javed Iqbal serves as Chairman of the Board, bringing nearly four decades of extensive experience in Pakistan’s steel industry, which significantly enhances the board’s strategic oversight capabilities. The Board collectively possesses the requisite skills, knowledge, and experience to ensure effective governance and sound decision-making. The inclusion of independent directors alongside family representatives strengthens the Company’s governance framework by promoting transparency, accountability, and balanced perspectives. All board members offer expertise across a range of disciplines and have served multiple terms, each exceeding three years. The Company’s external auditors, M/s Fazal Mahmood & Company, Chartered Accountants, and M/s Muniff Ziauddin & Company, Chartered Accountants, issued an unqualified audit opinion for the financial period ending June 2024.

Mughal operates under a well-structured organizational framework with clearly defined roles and responsibilities, supported by a high level of delegation. The reporting structure is distinctly outlined, with two Executive Directors and the Chief Executive Officer (CEO) reporting directly to the Board of Directors. This governance model facilitates efficient decision-making and promotes operational excellence throughout the organization. Mr. Khurram Javed serves as the CEO of the Company, bringing over a decade of professional experience to the role. He holds an MBA from Coventry University and has been instrumental in strengthening the Company’s human capital by attracting talent from a broad range of professional backgrounds. Under his leadership, the Company has enhanced its organizational capability and efficiency. The CEO is supported by a team of seasoned professionals with strong technical expertise and in-depth industry knowledge. Each department functions independently, holding regular performance review meetings led by departmental heads, who in turn report to the respective Executive Directors. This structured and focused approach ensures effective monitoring of departmental objectives and contributes to the overall strategic goals of the Company.

During FY24, Pakistan’s total local steel production stood at approximately 8.4 million metric tons (MT), reflecting a year-on-year (YoY) decline of 5.6%. Production of Billets and Ingots (Long Steel) decreased by 7.5% YoY to around 4.9 million MT, while Coil and Plates (Flat Steel) production declined by 2.7% YoY, reaching approximately 3.5 million MT. In contrast, steel imports witnessed a significant increase of 31.8% YoY, totaling approximately 2.9 million MT in FY24. This surge followed the lifting of restrictions on the import of steel products and scrap in June 2023, which had been imposed earlier due to economic constraints. The overall local supply of steel products in FY24 reached approximately 11.3 million MT, compared to 11.1 million MT in FY23, representing a modest YoY increase of 1.8%. This growth was largely driven by higher imports, reflecting increased demand amid a downturn in local production. Key players in the long steel segment include Amreli Steel and Mughal Steel. Since its listing on the Pakistan Stock Exchange (PSX), Mughal Steel has significantly diversified its product portfolio and enhanced its market presence. The Company has undertaken several major expansion initiatives, including increasing its power generation and melting capacities, replacing the Re-Rolling Bar Mill, expanding furnace capacity in the ferrous segment, and commissioning a feedstock processing plant in the non-ferrous segment, which became operational in June 2023. Additionally, the Board of Directors approved a PKR 2 billion Balancing, Modernization, and Replacement (BMR) project aimed at upgrading the existing steel bar rerolling mill to improve operational efficiency and reinforce the Company’s competitive position. In 9MFY25, Mughal reported a slight decline in revenue, with topline reaching PKR 66.168 billion, down approximately 1% from PKR 67.134 billion in the same period of the previous year (FY24 full year: PKR 92.383 billion). Gross profit followed a similar trend, declining to PKR 5.869 billion in 9MFY25 from PKR 6.434 billion in 9MFY24 (FY24: PKR 7.718 billion), primarily due to inflationary pressures. Looking ahead, the Company anticipates revenue growth, driven particularly by the expansion of its non-ferrous segment, which is expected to boost export volumes and reduce dependence on imported raw materials. In 9MFY25, gross and operating margins showed slight improvement over FY24, with gross margin rising to 8.9% from 8.4%, and operating margin improving to 7.6% from 7.2%. However, both margins remained significantly below historical levels—gross margin was 14.4% in FY23 and 15.3% in FY22, while operating margin stood at 13.1% in FY23 and 13.9% in FY22. Net profitability continued to decline, with a net margin of 0.7% in 9MFY25, compared to 2.2% in FY24, 5.2% in FY23, and 8.2% in FY22. This downward trend was largely attributable to persistent inflation, currency depreciation, elevated finance costs, and rising energy prices, all of which weighed heavily on the Company’s overall financial performance.

In 9MFY25, Mughal Iron experienced an increase in its working capital requirements, as reflected by a rise in the net cash cycle to 141 days, compared to 118 days at the end of FY24 and 145 days at the end of FY23. This increase was primarily driven by a higher inventory holding period, which extended to 101 days in 9MFY25, up from 86 days in FY24. To manage its working capital needs, the Company utilizes a mix of internally generated cash flows, privately placed instruments (such as sukuks), and short-term borrowings. As of March 2025, short-term borrowings stood at PKR 28.314 billion, slightly higher than PKR 27.992 billion recorded at the end of FY24. Free Cash Flow from Operations (FCFO) amounted to PKR 4.369 billion during the period, down from PKR 5.725 billion in 9MFY24. To support the increased working capital demand, the Company issued a short-term instrument worth PKR 2.5 billion. Total borrowings increased to PKR 32.550 billion in 9MFY25, compared to PKR 27.663 billion in 9MFY24. Finance costs remained relatively stable at PKR 4.669 billion, marginally lower than PKR 4.693 billion in the same period of the previous year. Consequently, the interest coverage ratio (FCFO to finance cost) declined to 1.2x in 9MFY25, down from 1.3x in 9MFY24 (FY24: 1.2x; FY23: 2.3x). The Company’s leverage ratio increased to approximately 54.2% as of March 2025, up from 51.8% in March 2024, though still lower than 57.0% recorded at the end of June 2024. Short-term borrowings continued to constitute the majority of the Company’s debt profile, accounting for 87% of total debt as of March 2025, compared to 81% as of June 2024. Despite the elevated debt levels, the Company has remained current on all debt obligations, with timely repayment of due installments. To further support its liquidity and working capital requirements, management is actively renewing existing bank facilities, seeking enhanced credit limits, and exploring the issuance of additional sukuks.

In June 2025, Mughal Steel issued a PKR 2,500 million Privately Placed Short-Term Sukuk (PPSTS) to support its working capital requirements. This issuance replaces a previous PPSTS of the same amount, which was issued on October 21, 2024, and matured on April 22, 2025. The financial covenants established through due diligence, including a minimum Current Ratio of 1.0x, a minimum Interest Coverage Ratio of 1.1x, and a maximum Leverage Ratio of 3.5x, all of which are to be maintained throughout the tenor of the instrument. While the Sukuk is unsecured, Mughal has assured that it holds adequate liquidity in the form of cash, cash equivalents, or unutilized credit lines with financial institutions to fully meet its repayment obligations. Both principal and profit will be repaid in a single bullet payment at the end of the Sukuk’s tenor.

The claims of certificate holders shall rank senior to those of ordinary shareholders.

The instrument is unsecured.