Cherat Packaging Limited ("CPL" or the "Company") was incorporated as a public limited company in 1989. The Company is listed on the Pakistan Stock Exchange (PSX) under the symbol CPPL.

Cherat Packaging Limited (CPL), part of the Ghulam Faruque Group, began producing paper sacks in 1992. It diversified into polypropylene bags in 2012, becoming a leading manufacturer of premium cement sacks, and further expanded into flexible packaging in 2017. Currently, the Company has significantly scaled up its flexible packaging operations and is also producing SOS bags and carrier bags as part of its broadened product portfolio.

The main business activities are the manufacturing, marketing, and sale of polypropylene (PP) and flexible packaging materials. The plant has an annual production capacity of 510 million bags/units, including the SOS bags project, along with 19.8 million kgs of extrusion, flexo and roto printing. The Company also exports cement bags, primarily to Africa. It is currently utilizing around 73% of its flexible packaging capacity. Furthermore, the Company is enhancing its flexible packaging operations through the installation of a new Barrier Extrusion Film plant, with a total project cost of PKR 1.4 bln.

Cherat Packaging is part of the Ghulam Faruque Group. Faruque (Pvt.) Ltd holds 10.25% stake in Cherat Packaging Limited, followed by Atlas Insurance Limited 9.2%, Cherat Cement Company Limited (7.35%), Greaves Pakistan Private Limited (5.02%), Mirpurkhas Sugar Mills Limited (4.97%). The Directors/other family members holds around 16% stake of the Company while the remaining stake is held by general public and other financial and non-financial institutions.

Since its inception, Ghulam Faruque Group has built a strong reputation for operational excellence and reliable performance. The Group has consistently undertaken strategic initiatives to diversify and expand its businesses, ensuring sustainable growth. Its proactive approach and well-planned investments across sectors reflect a commitment to long-term value creation and industry leadership.

The sponsors have strong business acumen emanating from the group's established presence in cement, sugar, Chemical, paper, and industrial Air conditioning and engineering sector. The diversified business lines provide a strong sense of stability as a group.

The Company’s major sponsoring and associated companies, including Faruque Pvt. Limited (10.25% shareholding), and Cherat Cement (7.35% shareholding with an equity base of PKR 33.3 billion), have sufficient financial strength to provide support if required.

CPL’s Board of Directors (BoD) consists of nine members, reflecting a balanced governance structure. The Board includes three independent directors, with representation from a female independent member as well. It further comprises two executive directors who contribute operational insight, while the remaining four non-executive directors strengthen strategic direction and stakeholder oversight. Overall, the Board composition aligns with the code of corporate governance.

Mr. Akbar Ali Pesnani, Chairperson of the Board, an MBA and fellow of both ICAP and ICMAP, has 49+ years of experience with the Aga Khan Development Network. He served as Chairman of Gwadar Port (2004–2006) and is currently Chairman of Aga Khan Cultural Service, Jubilee General Insurance, and Director at Cherat Cement and Pakistan Cables. He has a 44-year association with the Ghulam Faruque Group. Mr. Aslam Faruque, non-executive director, a Marketing graduate, is CEO of Mirpurkhas Sugar Mills, Unicol, and UniEnergy, and a board member of Greaves Engineering. Mr. Shehryar Faruque, non-executive director, a graduate of Davis & Elkins College, serves on the boards of Faruque (Pvt.) Ltd., Zensoft (Pvt.) Ltd., and Greaves Airconditioning (Pvt. ) Ltd. He previously served as Director at NAFA and Summit Bank. Mr. Arif Faruque, non-executive director, a Swiss-qualified attorney with master's degrees in Law and Business Administration, is the CEO of Faruque (Pvt.) Ltd. He serves on the boards of Mirpurkhas Sugar Mills, Cherat Cement, and Faruque (Pvt. ) Ltd. and is a member of the LUMS Board of Governors. Mr. Ali H. Shirazi, independent director, a Yale graduate, is Group Director Financial Services and CEO of Atlas Battery Ltd. He serves on the boards of multiple organizations, including Atlas Asset Management, Atlas Insurance, Shirazi Investments, Shirazi Trading Company (Private) Ltd, Atlas Venture Ltd. (UAE), Atlas Solar Ltd, Atlas Global FZE (UAE), Oyster Rebrokers Ltd (UAE), Atlas Real Estate (Private) Ltd, SF Global Holdings Ltd (UAE), SFM Investments DMCC, National Foods, Cherat Packaging, Pakistan Cables Ltd, Atlas Foundation, Atlas Vocational Training Institute, National Management Foundation (LUMS sponsor), and Pakistan Society for Training and Development. Mr. Sher Afzal Mazari, independent director, a progressive agriculturist, focuses on sustainable farming and land management solutions. Previously, he had a 34-year corporate career spanning Chemicals, Foods, and FMCG industries. Ms. Maleeha Mimi Bangash, independent director, is a renowned banking and financial expert with over 26 years of experience in Singapore, Turkey, and Pakistan. Her diverse background includes roles in textile, telecommunications, banking, financial services, and investments.

During the year, six meetings of the Board of Directors were convened, reflecting the Board’s active engagement and effectiveness in overseeing the Company’s strategic and operational matters. The two board committees namely: i)Audit Committee & ii) Human Recourse and Remuneration Committee. The Company has various policies in connection with Governance of Risk and Internal Control that have been approved by the Board of Directors and covered through different policies and disclosures. provide assistance to the board on important matters.

Grant Thornton Anjum Rehman-Chartered Accountants are the external auditors of the Company. They have expressed an unqualified opinion on the financial statements for the period ended Jun'25. The Company has an in-house internal audit department, which reports to the Audit Committee.

The Company has a well-developed organizational structure. The Company operates through two regional offices, located in Lahore and Islamabad, while its manufacturing facility is in Gadoon and a registered office located in Peshawar, reporting to the Head Office in Karachi. All the functional Heads report to the Company’s COO. The CFO and COO report to the CEO of the Company.

Mr. Amer Faruque, CEO of the Company, holds a BS in Business Administration from Drake University. He serves on the boards of Mirpurkhas Sugar Mills, Faruque (Pvt.) Ltd., Greaves Pakistan, and Greaves CNG and is Executive Director Marketing at Cherat Cement. He previously served on the boards of GIK Institute, LUMS, and CIPE and is the Honorary Consul of Brazil in Peshawar. All functional departments are headed by seasoned professionals. 

Management’s effectiveness and efficiency can be ensured through the presence of management committees. There are no management committees in place; however, there are IT steering, HRC, and Supply Chain committees that comprise one or more board members, ensuring the management's effectiveness and efficiency.  

CPL’s manufacturing division is in KPK. The head office in Karachi, regional offices and manufacturing facility are integrated through single ERP platform. The Company uses SAP and customized software to generate various types of operational reports as required by the management in order to monitor the activities effectively.

The Company has an effective mechanism for identification, assessment and reporting of all types of risk arising out of the business operations. To ensure operational efficiency, the Company has an in-house internal audit department. The Audit Committee reviewed the resources and performance of the Internal Audit department to ensure that they were adequate for the planned scope of the Internal Audit function. Head of Internal Audit Department has direct access to the Audit Committee.

Pakistan’s packaging industry consists of four major segments: paper, plastic, tinplate, and glass. Paper and plastic segments occupy the major share of total market. CPL operates under the paper and plastic segment of the Industry. The demand of the paper segment is directly correlated with food and fashion products, while the demand of the plastic segment is directly correlated with cement, food & consumer products. The PP Bags segment’s direct costs consist largely of imported raw materials. Therefore, volatility in exchange rates and international price trends has an impact on costs. For its Flexible Packaging Division (FPD), CPL also procures various raw materials locally, including inks, solvents, and films, ensuring efficient supply chain management and diluting the exchange rate import to remain competitive. CPL managed its cost effectively.

There are major players, including CPL, producing polypropylene (PP) bags and flexible packaging, with CPL holding a satisfactory market share. The industry trend of shifting from paper bags to PP bags has also been followed by CPL. Major players in PP bags are Ultra Packaging, Nova Synpac, Lahore Poly Industries and Syntronics. In the Flexible packaging category, the key players are Packages Ltd, Kompass Pvt. Ltd, Kamil Packaging, and Hamza Flexible.

The operations are segmented into two main Divisions: i) Bags manufacturing Division (Polypropylene bags and SOS/Carrier bags manufacturing) ii) Flexible Packaging Division (Extrusion, Flexo Graphic, and Rotogravure printing). The Company’s topline has shown sustained growth during FY25, with revenue standing at ~PKR 13.0 billion (FY24: PKR 13.8 billion). The Flexible Packaging Division has the larger share in revenue during FY 25, comprising above ~56% of total revenue(FY24: 51%).

The gross margins stood at 7.8% during FY25 (FY24: 10.6%), and the net profit margin is 2.7% in FY25 vs (FY24: 6.4%) mainly because of a shift in demand from paper sacks to polypropylene bags by the cement industry. There was also a general slowdown in cement dispatches in the country and greater competition in the marketing of polypropylene bag division. However, during this period, sales revenues of the Flexible Packaging division continued to show a rising trend.

The revival of the construction sector, coupled with increasing cement demand, is expected to positively impact the Company’s revenue. To enhance competitiveness, the company has diversified its PP bags sales and captured other industries, including sugar, floor, wheat, dairy feed, & chemical which have contributed towards higher topline in BMD. The Company has also commenced manufacturing of Carrier/SOS bags and has increased its share in the flexible packaging segment. In addition, with the upcoming installation of barrier extrusion line,  production of nylon films will also be initiated, supporting diversification and long-term operational sustainability. Despite strong industry competition driven by price sensitivity, these strategic initiatives position the Company for stable growth and resilience.

The cash operating cycle decreased to 148 days in FY25 from 173 days in FY24, primarily due to a reduction in inventory days and an increase in receivable days. Inventory days declined from 111 days in FY24 to 84 days in FY25 as the Company reduced its reliance on imports and improved inventory management. Payable days increased to 25 days in FY25 (FY24: 20 days), reflecting better negotiation with suppliers and improved working capital management. The majority of the Company’s sales remain on credit, in line with industry practice.

The Company’s borrowings increased during FY25; however, the debt profile remains largely tilted toward long-term borrowings, with short-term debt constituting a modest portion of the overall capital structure, indicating prudent liquidity management. Free cash flows from operations (FCFO) amounted to PKR 609 million in FY25 (FY24: PKR 1,095 million) and adequately cover the Company’s scheduled debt-payment requirements.

The capital structure of CPL is moderately leveraged, with gearing at 27.2% at the end of FY25, compared to 25.6% in FY24. Total assets increased to PKR 15.6 billion in FY25 from PKR 13.8 billion in FY24, primarily due to increasing market share price of investments in related parties and the acquisition of new machinery. Shareholders’ equity also strengthened to PKR 8.9 billion in FY25 from PKR 8.1 billion in FY24, supported by retained earnings, enhancing the Company’s overall capital base. During FY25, the Company paid a dividend of PKR 220 million (FY24: PKR 147 million).