PACRA Maintains Entity Ratings of Bulleh Shah Packaging (Pvt.) Limited

The ratings of Bulleh Shah Packaging (Private) Limited (‘BSPL’ or ‘the Company’) take into account its strong sponsorship profile, established industry positioning, and satisfactory financial strength. As a wholly owned subsidiary of Packages Limited, the Company benefits from a solid governance structure, effective internal controls, and a seasoned management team. BSPL operates in the production of paper and board products, along with corrugated boxes. Based on management’s estimates, the Company accounts for nearly 12% of the paper and board market. Furthermore, it is the only domestic producer of liquid packaging board and held around a 14% share in the corrugated board segment during CY24. During 6MCY25, gross margins came under pressure due to higher material costs. To support its customer base and remain competitive, the Company had to reduce product prices despite facing a higher cost of sales. Net profit margins also weakened, declining to -5.2% in 6MCY25 (6MCY24: -3.3%). The Company posted a net loss of PKR 1.7bln during 6MCY25, compared to a profit of PKR 996mln in 6MCY24. Correspondingly, equity declined to PKR 5.4bln in 6MCY25 (6MCY24: PKR 12.4bln). The Company’s capital structure continues to reflect high gearing levels, stemming from sizable short-term and long-term debt raised to meet working capital requirements and sustain business operations. To address performance challenges, the management has formulated a three-year roadmap focused on restoring profitability. The Company closed 2024 with a loss of PKR 6bln; however, by June 2025, losses had narrowed to PKR 1.7bln, indicating early signs of operational improvement and pricing recovery. This positive trend is further supported by an overall increase in sales, particularly driven by growth in the local market. The Board of Directors sanctioned a capital infusion of PKR 8bln through a mix of ordinary equity, subordinated financing, and potential conversion of outstanding loans into shares, with the intent of strengthening the balance sheet. Of this amount, PKR 4bln has already been injected as a subordinated debt, while the balance is expected to be received in subsequent periods. The Company was placed on Rating Watch to assess its future resilience and the effective implementation of its strategic plan. Going forward, the timely completion of the capital injection and the successful execution of management’s initiatives will remain critical for easing financial risk and supporting credit ratings.
The ratings are dependent upon the management's capacity to enhance margins while maintaining its market share. Effective management of working capital, along with sustaining adequate cash flows and coverage ratios, is crucial for the ratings. Going forward, the successful implementation of the strategic plan would remain crucial.

About the Entity
Bulleh Shah Packaging (Private) Limited was incorporated as a private limited Company on September 16, 2005. The primary purpose of the project was the backward integration of the packaging business of Packages Limited. The majority stake of BSP lies with Packages Limited which owns ~100% of the total shares. Mr. Syed Hyder Ali is the Chairperson of the board and Mr. Nasir Zaman is the CEO of the Company.