Unicol Limited (‘Unicol’ or ‘the Company’) is a public unlisted company, incorporated in 2003.

Unicol was setup as a joint venture among three sugar mills, namely, Faran Sugar Mills Ltd., Mehran Sugar Mills Ltd. and Mirpurkhas Sugar Mills Ltd (part of Ghulam Faruque Group, which was established in 1964). All the companies in JV agreement are listed on Pakistan Stock Exchange. The plant is located in Mirpurkhas, whereas, its head office is located on Beaumont Road, Karachi. The distillery became operational in 2007. While, food grade Carbon Dioxide (CO2) production began in 2014. The company’s strategic acquisition of sugar mill assets in 2023-24 has further strengthened its business profile. 

Primary business activity of the Company is to manufacture and sale ethanol, sugar and carbon dioxide. The Company produces Anhydrous Ethanol (ENA> ~99.9%), A-Grade Ethanol (ENA > 96% v/v ethanol) and B Grade ethanol (ENA>92% v/v ethanol) with installed production standing at 160MT per day. Unicol produced 47,251MT of ethanol during MY25 (MY24: 55,568MT) with utilization of 84% (MY24: 99%). The Company also produces food-grade LCo2 of 99.9% purity level through sugarcane fermentation, with an installed production capacity of 72MT per day. Unicol produced 11,106MT of LCo2 during MY25 (MY23:11,476MT), with utilization of 62% (MY24: 64%). During MY25, the Company produced 54,465MT of sugar (MY24: 60,481MT) with an installed production capacity of 8,000TCD per day.  

As the Company is a JV among three sugar mills, Faran Sugar, Mehran Sugar and Mirpurkhas Sugar holds equal stake of ~33.3% in Unicol.

Ownership of the Company seems stable. The sponsoring Group, Amin Bawany group, Hasham group and Ghulam Faruque Group, has strong and diversified standing in various segments of the economy.

Ghulam Faruque Group, Amin Bawany group and Hasham group is ranked amongst the leading industrial groups of the country with diversified interests in cement, FMCG, paper products, sugar and allied, trading, renewable energy and terminal handling. Strong affiliation and technical track record have added to the success of companies within the Groups.

The Company's financial resilience is attributed to the established strength of its sponsoring group, as well as the demonstrated operational efficacy and consequent financial robustness of its joint venture partners, specifically Mehran Sugar Mills, Faran Sugar Mills, and Mirpurkhas Sugar Mills Limited.

Board of Directors comprises 7 members including the Chairman and Chief Executive Officer. There are 5 Non-Executive Directors, 1 Chief Executive and 1 Independent Director on the BoD. The three sponsoring Companies have equal representation on the Company's board.

Mr. Asif Qadir, Chairman of the Board and an independent member, has an overall experience of more than 30 years. He is also on the board of Tripack Films Limited. Descon Oxychem Ltd, Liaquat National Hospital & Medical College, Century Paper & Board Mill Limited and Indus Motor Company Ltd. Mr. Azam Faruque, serving as an executive director of the Company, has an overall experience of more than 20years. He is also on the board of Cherat Cement Company Limited., Faruque (Pvt) Ltd, Greaves Pakistan (Pvt)Limited, Habib University Foundation and Atlas Honda Ltd. Mr. Ahmed Ebrahim Hasham, serving as an executive director of the Company, has an overall experience of more than 20 years. He is also on the board of Mehran Sugar Mills Limited, Mehran Energy Limited, Uni Energy Limited, Pakistan Molasses Company (Pvt) Ltd, MCB Islamic Bank Ltd and Hasham (Pvt.) Limited. Mr. Ahmed Ali Bawany, serving as an executive director of the Company, has an overall experience of more than 20 years. He is also on the board of Faran Sugar Mills Ltd, Reliance Insurance Company, Uni Energy Limited, B.F Modaraba and Uni-Foods. Mr. Khurram Kasim, serving as an executive director of the Company, has an overall experience of more than 20 years. He is also on the board of Mehran Sugar Mills Ltd, Pakistan Molasses Company (Pvt) Ltd, Hasham (Pvt.) Limited, Mehran Energy Ltd, Uni Energy Ltd and Mogul Tobacco. Mr. Omer Amin Bawany, serving as an executive director of the Company, has an overall experience of more than 20 years. He is also on the board of Faran Sugar Mills Ltd, B.F Modaraba, Reliance Insurance Company and World Memon Foundation.

During MY25, six Board meeting were convened among members with meeting minutes being captured formally. Detailed packs are shared before the meetings and are documented. The Company has an Audit Committee in place, which is chaired by Mr. Asif Qadir.

The Company’s external auditors, Grant Thornton, have expressed an unqualified opinion on the financial statements of the Company for the year ended Sept-25.

The Company’s organizational structure reflects clear reporting lines and is split between the production site and head office. The Company operates through seven functions; procurement, operations, sales and marketing, finance, IT, internal audit and HR.

The Company’s management comprises experienced and qualified individuals. Mr. Aslam Faruque, Chief Executive Officer, is a graduate of marketing. He has more than 25 years of experience in the sugar and ethanol industry. Additionally, he is the Chief Executive for Mirpurkhas Sugar Mills Limited. He is supported by Mr. Mustapha Qaisar (COO), Mr. Saad Ali Khawaja (CFO) and Mr. M. Asad Siddiqui (Company Secretary).

The performance / operations of the company are discussed among management and directors (Mr. Aslam Faruque, Mr. Ahmed Ebrahim Hasham and Mr. Ahmed Bawany) on a weekly basis to review activity.

The Company uses SAP software, managed by the group company Zensoft Pvt. Ltd, for MIS. Reports generated are submitted to senior management on a daily, monthly and quarterly basis.

Oversight and effective management is maintained through the internal audit department at group level. The department monitors various functions and internal controls of the Company, and reports to the Board’s Audit Committee.

The sugar industry in Pakistan operates within a competitive market structure, contributing approximately 0.8% to the nominal GDP and 3.5% to the value added in the agriculture sector as of MY24. Regional dynamics show that production is heavily concentrated in Punjab, which accounted for 68.5% of the province-wide distribution in MY25, followed by Sindh at 24.8% and KPK at 6.7%. The cultivated area for sugarcane remained steady at 1.2 million hectares in MY25 and MY24. Despite the adverse impact of floods, sugar production increased to 6.66 million tonnes in MY25 from 5.8 million tonnes in MY24. The market is dominated by major players, with the JDW Group (combined) holding the largest production share at 11.9% in MY24, followed by Hamza at 6.9% and Tandlianwala (combined) at 5.5%. Local sugar prices have historically been lower than global averages, though they are projected to rise to 450 USD/MT in 3MMY26. Total consumption is steadily growing, reaching an estimated 6.6 million MT in MY25, with per capita consumption at 27.4 kg. The distillery segment faced significant margin compression due to elevated molasses costs, constrained supply from a shorter sugarcane crushing season, and subdued international ethanol prices, compounded by broader inflationary pressures. Operations were maintained at reduced capacity to mitigate losses. Looking ahead, the segment is likely to continue experiencing margin pressures from volatile molasses prices, limited availability, currency devaluation, and inflation.

The Company is a leading player in the manufacturing of ethanol. Also the Comany has entered into the sugar segment with the market share of 1%.

The Company mainly sells ethanol and exports to a variety of countries concentrated in Middle East, Africa and Europe. The Company’s major customer, Alcotra SA (31%), is part of Alco Group which is a global network of companies specialized in the production, distribution, and trading of all grades of ethanol. Other major customers include Sasma BV (11%) and Tradhol Internacional Sa (9%). The topline is also supported through sale of liquid CO2 to local companies. These include Coca Cola Beverages, Pakistan Beverages, National Gases and Bolan Castings Limited. The Company’s topline consists of export (55%) and local sales (45%), showed a growth of 9.1% during MY25 (MY24: 28%). The main driver of the Company’s revenue is ethanol. Export sales of the Company decreased and stood at PKR 11bln during MY25 (MY24: PKR 13bln) due to decrease in volume of ethanol sold.

The company's financial performance improved during MY25, evidenced by increased profitability margins. Gross profit margins sharply increased to 14.8% from 7.3% in the prior year, reflecting a significant surge in revenue generated. Consequently, operating profit margins also improved, rising to 11.1% from 3.5%. Most notably, the company transitioned from a net loss of 10% in MY24 to a net profit of 1.8% in MY25, primarily attributed to substantial increase in operating profit to PKR 2,335mln from PKR 674mln, coupled with decline in finance costs to PKR 1,819mln from PKR 2,861mln.

The Company has acquired the assets of a sugar mill, integrating vertically. This has added the diversification in the Company's portfolio.

Due to the cyclic nature of the business, raw material (Molasses) and cane for the year has to be procured during the sugar crushing season i.e. from November till March. For this purpose, the Company sources its raw material from its sponsoring companies (Faran Sugar, Mehran Sugar and Mirpurkhas Sugar Mills), along with external sources. The company exhibited an enhancement in its working capital management during MY25. Average inventory days saw a marginal improvement, decreasing to 63 days from 82 in MY24, suggesting a slightly more efficient inventory turnover. Trade receivable days remained consistently low, at 3 days in MY25 compared to 2 days in MY24, indicating robust collection efficiency. Gross working capital days improved to 65 days from 84 days in the previous year. Trade payable days remained consistent at 4 days in MY25. Consequently, net working capital days decreased to 61 days in MY25 from 80 days in MY24 reflecting better approach to financial management.

Unicol’s financial health strengthened significantly in MY25, as Free Cash Flow from Operations (FCFO) more than doubled to PKR 2,761 million from PKR 1,247 million in MY24. This surge in cash generation, paired with a substantial reduction in finance costs, which fell to PKR 1,819 million from PKR 2,861 million, greatly enhanced the company's debt-servicing capacity. Consequently, the coverage ratio rose from a strained 0.3x to a healthier 1.3x, while the interest coverage (EBITDA over finance cost) improved from 0.4x to 1.6x, reflecting a much more robust and sustainable financial profile compared to the previous year.

Unicol continues to maintain a highly leveraged capital structure, though it showed signs of deleveraging in MY25 as the debt-to-equity ratio improved to 71.6% from 77.6% in the previous year. Despite this marginal reduction in overall gearing, the company’s debt profile remains significant, with 37% of its total borrowings comprised of short-term obligations. This suggests a continued reliance on immediate credit lines to support its seasonal operations, even as the broader equity cushion begins to expand.