Irfan Noman Brothers (Private) Limited (‘the Company’) was incorporated in Feb 1998 as a Private Limited Company under the Companies Ordinance, 1984 (now Companies Act, 2017).

Mr. Mukhtar Ahmad Sheikh, former Chairman of Rice Millers and Supplier Association, established a rice mill in 1960s and laid foundations of the Irfan Noman Group. Over the years the Group managed to gain prominence in the rice sector and established another rice mill and also established rice farms.

The Company is primarily engaged in processing semi-processed non-basmati and basmati rice, which it exports to Malaysia and over 40 other countries. In recent years, the Company has experienced significant growth in its operations, underscored by the establishment of two processing units located in Port Qasim and S.I.T.E Karachi. The company also owns approximately 12 acres of land, held in the name of Irfan Noman Brothers, and basic infrastructure, including two warehouses and related facilities, at FIEDMC Faisalabad. Going forward, the Company plans to expand its warehousing and storage capacity and enhance its rice processing facilities. The combined processing capacity of these units is 50 metric tons per hour, translating to an annual capacity of 420,000 metric tons. During the year ended Jun-26, capacity utilization stood at 150,743MT with utiliation rate reported at 35.89%. Additionally, the Company maintains a storage facility with a capacity of 55,000 metric tons. This expansion has resulted in a consistent upward trajectory in processing capacity, though current utilization remains below potential.

The company's major ownership is divided equally between two brothers and their respective sons. Mr. Noman Ahmad Sheikh holds the largest individual stake at 35%, and when combined with his son, Mr. Affan Bin Noman's 15% share, their family group controls exactly 50% of the company. The other brother, Mr. Irfan Ahmad Sheikh, owns 25%, while his two sons, Mr. Moaz Irfan and Mr. Sunaif Irfan, each hold an equal stake of 12.50%. This means the family group of Mr. Irfan Ahmad Sheikh also controls the remaining 50% of the company, resulting in a perfectly balanced ownership structure between the two branches of the family.

The Company is completely owned by the sponsoring family and the structure is seen as stable as the third generation has been successfully integrated in the family business. Formal succession planning would provide additional cushion to the stability.

The sponsoring family have been involved in the rice export business for over 6 decades and have witnessed multiple business cycles. The current sponsors have been associated with the Company for over 2 decades and have led to the prominence of the Company as one of the largest exporters of rice in the country

The sponsor's substantial net worth provides the financial capacity to support the Company during periods of distress. Equity increased to PKR 3,306 million in FY26 from PKR 2,720 million in FY25.

The Company’s Board is predominantly represented by the sponsoring family and comprises three Executive Directors and two Non-Executive Directors.

The board and management team is led by Mr. Irfan Ahmad Sheikh, the Chairman, who has been with the company since 1998, bringing extensive experience in the rice sector, including involvement in research and seed development and representing the company at various conferences globally. The next generation of directors includes two individuals who joined in 2024 and share a family history in the FMCG business: Mr. Affan Bin Noman, who graduated from York University with a major in Business & Society, serves as a Director assisting with purchase and production matters and received the prestigious 'Rice Export Trophy' on behalf of the company in 2024. Also joining in 2024 is Mr. Sunaif Irfan Sheikh, who holds a Commerce degree from York University and is responsible for the newly established Solar Business division. Finally, Mr. Moaz Irfan Sheikh, who holds a Bachelor's Degree in Finance from York University, serves as the Director of Sales & Marketing.

The Board convened multiple times during FY26, with majority attendance to discuss pertinent matters. The minutes of these BOD meetings were well documented. To ensure effective governance, the Board has formed two committees, namely, (i) Audit Committee, and (ii) HR and Remuneration Committee.

The Company’s FY25 financial statements were audited by Rahman Sarfaraz Rahim Iqbal Rafiq & Co., Chartered Accountants, which expressed an unqualified opinion, indicating that the financial statements give a true and fair view of the Company’s financial position and performance in all material respects. The auditor is a well-established firm, holding a Quality Control Review (QCR) rating and being listed in Category ‘A’ of the State Bank of Pakistan’s (SBP) approved panel of auditors.

The Company has optimized its organizational structure as per the operational needs. The Company operates through functions of Finance, Procurement, Internal Audit, Production, Sales, HR & Admin. All functional heads report to the Company’s CEO except Internal Audit and HR & Admin.

Mr. Noman Ahmad Sheikh, who has served as the CEO since 1998, possesses extensive and distinguished experience in the rice sector. His deep involvement includes pioneering rice research and seed development, actively participating in introducing new seed varieties from abroad, and representing Pakistan internationally. Notably, he has led delegations to China and participated in numerous rice conferences and seminars abroad. His expertise has been recognized nationally, as evidenced by his former role as Senior Vice Chairman of the Rice Exporters Association of Pakistan and his receipt of the Best Businessmen of the Year Gold Medal award from the Prime Minister of Pakistan.

The Company benefits from streamlined operations, a direct result of the extensive experience of its sponsors combined with a professional management team. To further ensure management effectiveness and efficiency, the company utilizes a dedicated Management Committee. This committee is functionally diverse, comprising the Directors, the GM Plant, the CFO, the CAO, the CIA, and the Head of HR & Admin.

The Company has a customized ERP system implemented by RATEX, through which MIS reports are generated regularly and reviewed by Management to support operational efficiency and informed decision-making.

The Company has an internal audit function in place, which facilitates the timely identification, assessment, and reporting of risks arising from its business operations.

Pakistan's rice sector faced a complex operating environment in FY26, characterized by stable domestic production but significantly weakened export demand and pricing. Total rice production remained stable at approximately 9.7 million metric tons, comprising 5.4 million MT of nonbasmati (IRRI) and 4.3 million MT of basmati varieties. However, this production stability masked underlying market pressures. Pakistan's rice exports contracted to approximately 4.3 million MT valued at USD 2.29 billion during FY26, representing a 26% decline in volume compared to 5.82 million MT worth USD 3.25 billion in the corresponding period of FY25. This contraction was primarily driven by India's re-entry into global rice markets following the removal of its export ban in late 2024, which intensified price competition and displaced Pakistan's market share, particularly in the non-basmati segment. Beyond commodity price pressures, the sector faces significant logistical headwinds: the Middle East conflict has disrupted Red Sea and Hormuz shipping lanes, increasing freight costs for Pakistan's three largest Gulf markets (Saudi Arabia, UAE, and Oman), which collectively account for over 37% of basmati exports. The Pakistan-Afghanistan border closure has effectively eliminated approximately 6% of Afghanistan export share and threatened the Kazakhstan corridor, Pakistan's largest basmati destination at 15.5% of total exports, which is partly accessed via Afghan transit routes. These structural challenges position the rice sector in a difficult transition period, with recovery dependent on global price stabilization, restoration of traditional export corridors, and successful execution of government-to-government export agreements to clear accumulated inventory.

The Company is a leading player in the country’s rice exporters market and holds approximately 2.5% market share in terms of sales.

The Company's core business is the export of basmati and non-basmati rice, which drives the majority of its revenue, primarily through sales to key international markets including Indonesia, Malaysia, China, and Africa. International markets remain strategically vital, accounting for approximately 75% of the company's total revenue, with the remaining 25% generated from local sales including rice and diversified products. Its rice export portfolio is heavily weighted toward non-basmati varieties, reflected in an export combination of about 70-75% IRRI (non-basmati) to 20-25% Basmati. To mitigate agricultural export risks, the Company has diversified its revenue streams through the trading of solar panels. The solar panel division contributed 10.1% of total revenues in FY26, indicating meaningful traction in this new business segment. Despite these diversification efforts, the Company faced continued headwinds in FY26, experiencing a further 15% decline in revenue, contracting from approximately PKR 19.3 billion to PKR 16.4 billion. This persistent contraction reflects weakness in both international and domestic markets, with the decline in revenue predominantly driven by adverse pricing dynamics in the IRRI export market. While IRRI export prices had stabilized in FY25 (ranging from $500 to $600per metric ton), they deteriorated further in FY26, settling between $325 to $350 per metric ton, primarily due to oversupply pressures from India and global market dynamics. The increased contribution from domestic sales, particularly through the solar panel division, has partially offset the decline in rice export volumes.

Despite operating in a challenging revenue environment marked by persistent commodity price pressures, the Company has successfully improved its margin profile. The Gross Profit margin expanded to 9.2% in FY26 from 8.9% in FY25, demonstrating the continuation of a positive trend that commenced in FY25. This sustained improvement reflects the Company's effective management of raw material costs, which have been successfully controlled despite inflationary pressures in the broader economy. The Operating Profit margin has remained largely stable at 0.9% in FY26 compared to 0.8% in FY25, indicating that while production efficiency has improved, the Company's operating cost structure has remained relatively unchanged as a proportion of revenues. The most significant improvement has been in the Net Profit margin, which reached 0.8% in FY26, substantially higher than the 0.2% recorded in FY25. This improvement is primarily attributable to a considerable reduction in finance costs, decreasing to PKR 210mln from PKR 235mln in the previous year.

The sponsors are planning to add storage and processing facility at Faisalabad, Punjab to increase the Company’s footing in the basmati sector.

The Company's working capital management deteriorated significantly in FY26 according to management financials, with the net working capital cycle extending substantially to 85 days from 49 days in FY25. The primary driver of this deterioration has been a sharp increase in inventory holding periods, which more than doubled to 64days from 31 days year-on-year. This expansion was predominantly attributable to raw material inventory days, which increased from 23 days to 55 days. This was mainly due to delay of the export season. The Middle East conflict's disruption of critical Red Sea and Hormuz shipping lanes significantly impacted export timelines, causing shipping delays and elevated freight costs. This geopolitical disruption resulted in further timing mismatches, with exports ordinarily recognized during February-March being deferred to April- May, and volumes expected by June-end realized only during July-August. These supply-side constraints and shipping route disruptions resulted in inventory accumulating to PKR 4.0–4.5 billion against a normal level of PKR 1.5–1.6 billion. Finished goods inventory days also increased marginally from 8 days to 10 days. Concurrent with inventory pressures, trade receivable days extended from 21 days to 26 days, indicating slowdown in collections. The Gross Working Capital cycle consequently lengthened from 52 days to 91 days. While trade payable days improved from 3 days to 6 days, this marginal enhancement was wholly insufficient to offset the substantial increase in current asset requirements. Effective management of raw material and finished goods inventory levels will be critical to releasing tied-up capital and improving cash flow generation in the forthcoming period.

The Company’s debt servicing capacity remained relatively strong in FY26, as reflected by the improvement in EBITDA/Finance Cost coverage, which increased to 8.0x from 6.2x in the previous period. FCFO/Finance Cost improved to 2.1x from 1.2x, supported by the lower finance cost burden and improved FCFO, reporting at PKR 160mln in FY26 as compared to PKR 104mln during the previous year. 

The Company's capital structure has become materially more leveraged in FY26, with total borrowings increasing significantly to PKR 6,458 million from PKR 3,642 million in FY25, representing an increase of approximately 77%. This substantial increase in debt, coupled with modest equity growth, has resulted in the leverage ratio deteriorating from 57.6% to 67.2%, indicating increased reliance on leverage to finance operations. The composition of this debt majorly reflects short-term borrowings which nearly doubled from PKR3,461 million to PKR 6,340 million, now representing 93.7% of total borrowings, marginally higher than the 93.6% concentration in the prior year. The significant increase in short-term borrowings was primarily driven by elevated working capital requirements stemming from operational disruptions during the year. the Middle East conflict's disruption of critical Red Sea and Hormuz shipping lanes severely impacted export execution, causing significant shipping delays. These temporary working capital pressures inflated short-term borrowing utilization to PKR 6.5–6.75 billion during the procurement season, though management anticipates normalization to approximately PKR 4.0–4.5 billion under regular operating cycles as exports are executed and customer payments are received. Conversely, long-term borrowings declined from PKR 128 million to PKR 71 million. Equity base strengthens slightly with improving at PKR 3,306mln from PKR 2,720mln.