United Ethanol Industries Limited, referred to as "United Ethanol" or "the Company," operates as a publicly unlisted entity.

United Ethanol Industries Limited was established in 2003 and was initially owned by the Etihad Group, a prominent business conglomerate. Over the years, the company gained recognition in the ethanol production industry. However, in 2016 a significant transition took place when ownership of the company was acquired by the Essarani Family. This acquisition marked a pivotal moment in the company’s history, as it subsequently became a vital part of the United Group, a diversified business entity with a strong presence in various sectors. The Essarani Family’s leadership and strategic vision have since played a crucial role in shaping the future direction and growth of the company within the United Group.

The company's manufacturing facility is strategically located in Sadiqabad, Rahimyar Khan, providing easy access to 11 sugar mills within a 100-kilometer radius, including its own subsidiary, SGM Sugar Mills. Specializing in the production of ENA Grade ethanol (~96% v/v ethanol) and B Grade ethanol (~94% v/v ethanol), the facility boasts an installed production capacity of 120,000 liters per day. During 9M-MY25, the Company produced 32.37 million liters of ethanol, compared to 29.45 million liters in MY24, reflecting a slight increase. The improvement was primarily driven by higher availability of molasses during the period.

The ownership structure of the company is held by the Essarani Family, with Mr. Deoo Mal Essarani holding a ~24% stake. His four sons are also significant shareholders: Mr. Asha Ram owns ~20%, Dr. Tara Chand holds ~24%, Mr. Mahesh Kumar possesses ~22%, and Mr. Jugdesh Kumar has a ~9% stake in the Company. This distribution reflects a family-controlled ownership model, ensuring that decision-making remains centralized within the family, which can contribute to a unified long-term strategic vision for the company.

Given the current ownership distribution and the strong family involvement, it is unlikely that significant changes will occur in the near future. The family's control of the majority of shares and the absence of outside investors suggest that the enterprise is positioned for continuity. This stability provides a solid foundation for maintaining long-term operations and can also foster trust with stakeholders, including employees, customers, and business partners, who value consistency in leadership and direction.

The Essarani family brings a wealth of experience in the agricultural sector, operating under the umbrella of the 'United Group.' The group's diversified portfolio spans multiple industries, with key assets including three sugar mills—Sindh Abadgar's Sugar Mills, SGM Sugar Mills and Ranipur Sugar Mills (Pvt) Limited. Additionally, the family’s holdings extend to United Ethanol Industries Limited, a major player in ethanol production, as well as Agro Trade Private Limited, United Commodities (Pvt) Limited, United Agro Chemicals and Synergy Packaging (Pvt.) Limited, which further strengthen the group’s overall business presence.

The company maintains robust financial stability attributed to the support of its group and sponsors. As of the MY24, the group's total assets amounted to ~PKR 40.7 billion. During this period, the group achieved a net profit of ~PKR 2.5 billion. The group maintains a moderate level of leverage. This stable financial position the Company for continued growth and resilience in the face of market fluctuations.

The Board of Directors is composed of four members, encompassing the Chairman, CEO, and two Non-Executive Directors. The board is predominantly influenced by the sponsoring family, lacking independent oversight, signifying an opportunity for enhancement. The sponsors have expressed their intention to augment the Board's composition by appointing an independent director in the future.

Mr. Deoo Mal Essarani serves as the Chairman of the Board and also holds the position of Chairman on the board of all other group companies, namely Sindh Abadgar’s Sugar Mills Limited, SGM Sugar Mills Limited, Ranipur Sugar Mills Limited, Synergy Packaging (Pvt) Limited, United Commodities (Pvt) Limited, Agro Trade (Pvt) Limited and United Agro Chemicals. With over 47 years of experience, he assumed the chairmanship role. Meanwhile, his son, Mr. Mahesh Kumar, serves as a Non-Executive Director, bringing more than 21 years of experience to the board. Additionally, Mr. Mahesh Kumar holds a position on the board of Sindh Abadgar’s Sugar Mills Limited and SGM Sugar Mills Limited.

During the MY25, the Board of Directors convened for a total of four meetings, ensuring that detailed and formal minutes were recorded for each of these sessions. These meetings served as key opportunities for the Board to discuss and make decisions on various matters concerning the company’s operations, strategies, and governance. At this time, United Ethanol has not implemented any specific Board committees, which are often used by companies to delegate particular responsibilities or areas of oversight to smaller, specialized groups within the Board. Without these committees, all decision-making and oversight duties fall directly to the full Board.

The Company's external auditors are Reanda Haroon Zakaria & Co. Chartered Accountants The audit firm is rated in category 'B' of SBP's panel of auditors.

The Company's organizational structure is clearly defined, with distinct reporting lines that differentiate responsibilities between the production site and the head office. Operational functions are primarily overseen by the General Manager (GM) of the Mill, who is responsible for day-to-day production activities. On the other hand, support functions, with the exception of finance, are managed centrally at the group level. These functions are under the supervision of the Group Chief Financial Officer, who ensures consistent oversight and alignment with the company’s overall strategy.

The Company’s management team is composed of experienced professionals, although they have not been with the Company for an extended period. Dr. Tara Chand, the CEO, brings over 19 years of expertise in the sugar and allied industries. In addition to his role as CEO of the Company, Dr. Chand also serves as the CEO of Sindh Abadgar’s Sugar Mills. He is supported by a skilled leadership team, including Mr. Abdul Waheed, who serves as the General Manager (GM) of the Factory, and Mr. Saqib Ghaffar is the Group Director Finance. Together, they provide strong leadership and direction for the Company.

The Company currently does not have formally established management committees. However, the management team engages in regular performance discussions to assess and review ongoing activities. These discussions allow the leadership to evaluate the progress of various initiatives, address challenges, and ensure alignment with the Company’s strategic goals

The Company has implemented Enterprise Resource Planning (ERP) software from Cosmosoft to streamline its operations and enhance efficiency. This software helps integrate various business processes, providing a centralized system for managing key functions such as inventory, production, finance, and human resources.

The internal audit function is currently centralized at the group level. Going forward, the group plans to enhance its control environment by expanding the internal audit team, adding more personnel to oversight and improve the effectiveness of internal controls across the organization.

Pakistan’s sugar industry, the country’s second-largest agro-based sector with approximately 90 mills and an annual crushing capacity of 80–90 million metric tons, continues to face structural challenges—chiefly the government-mandated sugarcane support prices, which are based on farmers' input costs and often compress millers’ margins.  In MY25, sugarcane production declined to 84.2 million metric tons from 87.6 million metric tons in MY24, primarily due to below-average rainfall. Lower yields and weak recovery rates resulted in a subdued crushing season, reducing sugar production to 6.3 million metric tons from 6.8 million metric tons in the previous year. Opening stocks for MY25 stood at 1.4 million metric tons, of which 0.8 million metric tons were approved for export. Domestic consumption rose to 6.6 million metric tons, creating a supply-demand imbalance exacerbated by export volumes and reduced output, leading to a sharp increase in sugar prices.  To curb market volatility, the federal government authorized the import of 500,000 metric tons of sugar. The Trading Corporation of Pakistan (TCP) had already accepted bids for 200,000 tons at USD 580–586 per ton, equating to approximately PKR 165/kg.  Looking ahead, sugarcane output in MY26 is expected to recover, driven by improved water availability following floods and heavy rainfall in Punjab.

In MY25, the Company accounted for a modest yet notable share of Pakistan’s total ethanol exports, underscoring its meaningful presence in the national export landscape.

The Company’s revenue base remained heavily export-driven, with exports accounting for 97% of total revenue in 3QMY25, reinforcing its dependence on international markets and exposure to global price volatility. Revenue for the quarter declined to PKR 4,005 million, representing a 27.7% drop from PKR 5,541 million in 3QMY24 and PKR 7,040 million in MY24. This contraction was primarily driven by lower international ethanol prices, which averaged USD 700–800 per ton amid global supply-demand adjustments and competitive pressures. Looking ahead, the European Commission’s suspension of Pakistan’s GSP+ tariff preferences on ethanol introduces an additional export-market constraint, as the Company will face non-preferential tariffs in Europe, likely compressing export.

During 3QMY25, a decline in molasses prices supported a partial recovery in gross profitability, signaling relief from elevated input costs and contributing to improved margin stability. The gross profit margin strengthened to 20.3%, up from 16.2% in MY24, which translated into a higher operating profit margin of 12.7% (MY24: 9.3%). Consequently, the net profit margin improved to 6.7%, compared to 5.1% in MY24, reflecting enhanced cost efficiency. Although margins improved during the period, the sharp decline in sales translated into a weaker bottom line. Net income fell by approximately 22%, reaching PKR 266 million in 3QMY25 compared to PKR 341 million in 3QMY24. This indicates that the margin recovery was insufficient to offset the adverse impact of reduced topline.

The Company has recently acquired Ranipur Sugar Mills (Pvt) Limited, which has a crushing capacity of 8,500 tons per day. This strategic acquisition has strengthened the Company’s overall business profile by enhancing its asset base and diversifying its operations into the sugar segment. Through this backward integration, the Company has successfully streamlined the procurement of molasses, which will contribute positively to cost efficiency and supply reliability.

The Company’s net working capital cycle deteriorated in 3QMY25, extending to 147 days from 120 days in MY24. The elongation in the cycle was primarily driven by a rise in inventory holding days, which increased to 142 days in 3QMY25 from 104 days in MY24. The higher inventory levels suggest slower inventory turnover, indicating potential inefficiencies in inventory management or a buildup of unsold stock. On the other hand, receivable days improved to 10 days in 3QMY25, compared to 21 days in MY24, reflecting enhanced collection efficiency and better credit control measures, which positively impacted liquidity. Payable days remained relatively stable at around 5 days, implying consistent payment practices with suppliers. Overall, while the Company’s working capital management reflects stronger receivable discipline, the elevated inventory levels have exerted pressure on the cash conversion cycle.

In MY24, the Company’s financial coverage metrics reflected a moderation in performance, primarily due to weaker operating cash generation. The interest coverage ratio declined to 3.1x, compared to 4.2x in MY23, driven by a notable reduction in free cash flow from operations to PKR 868 million (MY23: PKR 1,726 million). Similarly, the debt coverage ratio decreased to 2.1x in MY24 from 2.5x in MY23, indicating reduced headroom for servicing both interest and principal obligations. While the Company remains adequately positioned to meet its debt commitments, the downward trend underscores the need to strengthen operating cash flows to preserve financial flexibility.

The Company’s capital structure remained conservative in 3QMY25, with the Debt-to-Equity (D/E) ratio declining to approximately 22%, from 31% in MY24. The moderation in leverage reflects a marginal reduction in total borrowings, underscoring the Company’s prudent financial management and balanced funding mix. Total debt declined to PKR 1,764 million in 3QMY25, from PKR 2,613 million in MY24, primarily due to a reduced reliance on short-term working capital facilities. The Company continues to maintain a debt-free long-term profile, providing it with financial flexibility and a low-risk balance sheet structure. Meanwhile, shareholders’ equity increased to PKR 5,945 million in 3QMY25, up from PKR 5,769 million in MY24, supported by healthy retained earnings. This steady growth in equity reinforces the Company’s capacity to internally fund operations and sustain its capital base.