PACRA Maintains the entity Ratings of Salman Paper Products (Pvt.) Limited

Salman Paper Products Private Limited ("the Company") is a prominent player in the import and trade of paper and board, operating with a high-turnover and efficient business model. This approach has solidified its position as a leading importer, particularly in southern markets. The Company is led by Mr. Aslam Jilani, its sponsor and CEO, who brings over 30 years of industry expertise and plays a pivotal role in its operations. While the Company's governance structure is relatively simple—comprising only two board members and lacking formal board committees—its management team demonstrates strong operational expertise and a deep understanding of industry dynamics. Demand for its products is primarily driven by paper and paperboard consumers, and its stable customer base supports its credit rating. The Company has experienced a substantial increase in sales volume driven by heightened market demand. This surge has also resulted in higher plant production, with output levels aligning with the increased demand. With an annual production capacity of approximately 31,000 MT, its utilization rate surged to around 90% in FY24, up from 70% in FY23. During FY24, the Company reported topline revenue of PKR 13,560 million, marking a 34% increase from PKR 10,091 million in FY23 (FY22: PKR 9,542 million). The bottom-line profit also grew to approximately PKR 273 million in FY24, up from PKR 171 million in FY23. Moving forward, product demand is expected to stabilize in line with economic conditions. Salman Paper Products maintains a moderately leveraged capital structure, primarily using short-term debt to meet its working capital needs. As of June 2024, the Company's equity stood at PKR 1 billion. To further enhance governance and oversight, the establishment of an internal audit department under the direct supervision of the directors is encouraged.
The ratings are dependent upon the management’s ability to improve margins while sustaining its market share. Prudent management of the working capital and maintaining sufficient cash flows and coverages are essential for the ratings. Any significant change in margins and coverages will impact the ratings.

About the Entity
The Company was established in 2005 as Jilani Enterprises. In 2012, Jilani Enterprises was renamed to Salman Paper Products Private Limited and got registered with SECP as on 2019 with as hare capital of PKR 20mln. The Company is owned by CEO/owner Mr. Muhammad Aslam Jilani having 99% shareholding. Although Salman Paper Products deal in four main products, but it has wide spread customer and supplier base. The Company imports finished goods as raw material and sells to customers after cutting and printing, selling to northern, central and southern regions of Pakistan. Four products; namely: Art card, Packaging board, Stickers and Printer paper are sold to customers divided into direct sales and dealerships - who resell to other customers. About 70% of customer base of Salman Paper Products is located in southern region.