PACRA Maintains Entity Ratings of Bestway Cement Limited

Bestway Cement Limited’s (“the Company”) ratings reflect its leading position in the cement sector, underpinned by its sizeable market share in the northern region. The Company has successfully maintained this position through both organic and inorganic capacity enhancement initiatives. In line with the industry’s expansionary phase and to sustain its competitive edge, Bestway completed two major projects in FY23: a Greenfield cement plant and a Brownfield production line, each with a clinker capacity of 7,200 tonnes per day, complemented by a 9 MW Waste Heat Recovery Power Plant. These additions elevated the Company’s total cement production capacity to ~15.3 million tons per annum. During FY25, overall industry dispatches recorded a modest growth of 3%, rising from 44.8 million tons in FY24 to 46.0 million tons. This uptick was primarily driven by a robust 30% increase in export volumes, which grew from 7.1 million tons to 9.2 million tons. While the Company’s total production remained stable, its overall dispatches contracted by 2%. However, in contrast to the industry trend of weakening domestic demand, Bestway posted a ~2% decline in domestic volumetric sales, supported by the incremental capacity available from FY24 expansions. The Company’s revenue growth was supported by sustained sales volumes and an upward adjustment in selling prices, which was necessitated by persistent escalation in input costs. These measures enabled the Company to preserve margins, reflecting the effectiveness of its strategic and operational adjustments. On the financial front, management’s concerted deleveraging efforts have significantly reduced the Company’s financial risk profile. By June 2025, the leverage ratio had declined to 31.2%, from 49.7% in June 2024. Furthermore, the recent reduction in policy rates is expected to strengthen financial flexibility and reduce finance costs, thereby providing additional support to profitability. The ratings are further reinforced by steady dividend income from the Company’s strategic investment in United Bank Limited (UBL), in which Bestway has enhanced its shareholding from 8.16% to 9.6%. This investment continues to provide a stable income stream and complements the Company’s core operations.
The Company's business performance with local demand remains vital with focus on sustaining margins. The ratings also draw comfort from the strong sponsor support (Bestway Group). The ratings are dependent on upholding of company’s leading market position along with sustenance of business volumes and margins. The company's good business performance as compared to other players in current stretched economic scenario - challenges on demand front - remains vital for ratings.

About the Entity
Bestway Cement operates as one of the largest cement manufacturers of the country with total cement capacity of ~15.3mln tons p.a. Bestway Cement, listed on PSX, is majority owned by Bestway Group (BWG) UK (72.7%), mainly through corporates (60%), followed by individuals (~12.3%). The Company's nine-member board comprises mainly BWG nominees. Two directors are Bestway Cement's executives (including CEO) while seven are non-executive directors including three independent members. The board’s Chairman Mr. M. Anwar Pervez is an experienced professional, also a founding member of Bestway Group. The CEO, Mr. Zameer Mohammed Choudrey, is a Chartered Accountant, associated with the group since 1984, supported by a team of experienced professionals.