PACRA Upgrades Entity Ratings of Martin Dow Limited

Martin Dow Limited (hereinafter referred to as “MDL” or the “Company”) is an operating and holding company of the Martin Dow Group (MDG), one of the established pharmaceutical groups in Pakistan. The sponsoring family has been engaged in the pharmaceutical business for over six decades. MDG currently comprises four companies: (i) Martin Dow Limited – group holding and operating company, (ii) Martin Dow Marker Limited, (iii) Martin Dow Specialties (Private) Limited, and (iv) Seatle (Private) Limited. Over time, the Group has built a diversified portfolio covering both chronic and acute therapeutic segments. Its growth strategy has been shaped by a combination of strategic acquisitions and organic portfolio expansion. Notably, the Group acquired multiple products and industrial assets of Roche in 2010 and Merck in 2016, which significantly enhanced its presence in the industry. MDG manufactures and markets a wide range of well-recognized medicines across several therapeutic areas, while MDL’s standalone portfolio also includes a number of established brands. The Company holds leading positions in multiple molecules, with key brands including Lexotanil, Synflex, Librax, Rocephin, Toradol, and Enflor. As of December 2024, MDL reported consolidated revenues of ~PKR 43.8 billion, compared to ~PKR 36.3 billion (CY23). The Martin Dow Group benefits from its longstanding associations and strategic alliances with multinational pharmaceutical companies such as Roche, Merck, Sanofi, and Boehringer Ingelheim. MDL continues to modernize its manufacturing operations and has successfully localized the production of several products by acquiring relevant licenses. These initiatives have helped reduce cost pressures and supported an improvement in profitability. Favorable macroeconomic trends and the deregulation of non-essential products have also contributed positively to margins. During FY25, the pharmaceutical sector in Pakistan surpassed the PKR 1 trillion mark and registered a notable growth. The top 15 players enjoy ~60 percent of the total industry revenue, according to IQVIA. On a consolidated basis, Martin Dow Group maintained its sixth position in the industry and achieved revenue growth of ~21% in CY24. The Company’s Board comprises experienced professionals, and its size and composition are aligned with statutory corporate governance requirements. MDL’s financial risk profile has improved, supported by adequate cash flow generation, sufficient coverage metrics, and a manageable working capital cycle. The capital structure remains leveraged, with long-term borrowings primarily utilized for acquisitions and expansion, and short-term facilities employed for working capital management. Looking ahead, the Company continues to broaden its product portfolio with new launches and is pursuing opportunities to strengthen its presence in export markets, thereby enhancing its overall growth prospects.
The ratings are dependent on the management’s ability to sustain its growth in revenues, margins, and improvement in profitability. Prudent management of the working capital, and maintaining sufficient cash flows and coverages are imperative. Further, maintaining leverage at an adequate level will be imperative for the ratings.

About the Entity
MDL was incorporated in Pakistan on February 6, 1995, as an unlisted public limited company. In 2010, MDL acquired the Roche facility in Pakistan along with the acquisition and brand licensing of the global product lines from Hoffman-La Roche, Switzerland. Mr. Ali Akhai is the ultimate beneficial owner of the Company. MDL has a 4 members board including the Chairman, Mr. Ali Akhai, Mr. Javed Ghulam Muhammad (CEO), Mr. Abdul Samad (Group CFO), and Mr. Syed Dawood (Independent Director).