PACRA Maintains the Entity Rating of Tariq Glass Industries Limited

Tariq Glass Industries Limited (“the Company” or “TGL”) enjoys a well-established position within the glass industry, supported by its strong reputation and oligopolistic business profile. As a premier manufacturer of tableware, float glass, and container ware in Pakistan, TGL has built a robust foothold in the market. The Company’s manufacturing facilities are equipped with advanced capabilities, enabling the production of clear, colored, tinted, reflective, and sandblasted float glass via an online Chemical Vapor Deposition (CVD) coating mechanism, as well as mirrors utilizing the latest spectrum technology. To sustain growth, TGL is strategically focused on expanding its export base and adopting state-of-the-art manufacturing technologies to enhance cost efficiency and align with global quality standards. In the float glass segment, where competition is characterized by a duopoly, the Company claims a ~50% market share under its flagship brand “Tariq Float Glass,” recently rebranded as "ToyoNasic Float Glass." The performance of Pakistan’s glass industry is closely linked to economic activity in the construction sector, which has historically been impacted by economic slowdowns, hyperinflation, and reduced consumer purchasing power, leading to decreased demand for construction materials, including glass. However, during the first half of FY25, the industry's recovery prospects appear promising, supported by positive economic indicators and a significant reduction in the policy rate. In tableware segment, TGL boasts a legacy of over four decades, supported by iconic brands such as Toyo Nasic, Omroc, Nova, Rockware, Gemware, and Spinrex. The Company has maintained an impressive ~50% market share in the tableware segment by offering value-added products tailored to meet the needs of the consumers. emphasizing the quality of products alongside economies of scale. During FY24, TGL's topline grew modestly by ~4%, driven by inflationary adjustments in selling prices, though overall volumes slightly declined. Improved pricing strategies contributed to margin enhancements at all levels. Current capacity utilization stands at ~50%, impacted by the temporary closure of one float glass and one tableware plant. These facilities are expected to resume operations as market demand strengthens. Additionally, TGL’s strategic acquisition of a ~42% stake in Baluchistan Glass Limited through a share purchase agreement is anticipated to fortify its product portfolio in tableware, container ware, and glass packaging for pharma products. The Company continues to enhance its corporate governance framework, with independent oversight and established board committees ensuring sound decision-making processes. TGL is managed by a seasoned leadership team, and its operations benefit from a robust system of internal controls. The financial risk profile of the Company demonstrates healthy coverages, an efficient working capital cycle, and stable cash flows. Its capital structure remains moderately leveraged, supported primarily by long-term concessionary borrowings (LTFF) utilized for capacity expansion, Modernization, and Replacement (BMR) initiatives.
The ratings are dependent on the sustainability of profits and market share while retaining sufficient cash flows and coverages. Moreover, adherence to maintaining its debt metrics at an adequate level is a prerequisite.

About the Entity
TGL is a public listed company incorporated in 1978. The sponsoring family collectively holds ~48.57% directly and ~11.79% through associated companies. Whereas, ~20.52% is held by the general public, ~8.71% by Modarbas and Mutual Funds, and ~10.41% is held by financial institutions. The board comprises seven members. Mr. Omer Baig serves as the MD/CEO of TGL.