PACRA Maintains the Entity Ratings of Crown Textile, With a Positive Outlook.

The rating reflects Crown Textile (Pvt) Limited's (“Crown Textile” or "the Company") established position within Pakistan's knitted garments industry. The Company is among the largest manufacturers and exporters of knitted garments in the country. The Company's core operating activity encompasses the manufacture and export of a comprehensive range of apparel for men, women, and children. Crown Textile is a vertically integrated, value‐added textile unit that procures yarn and converts it into finished garments, including knitting, dyeing, printing, embroidery, washing, cutting, and stitching through in-house facilities. The Company maintains a total of 101 knitting machines with a combined fabric production capacity of 40,000 to 45,000 kg per day, operating at a current utilization rate of 90%, complemented by a dyeing capacity of 50,000 kg per day. The financial strength of the Company is primarily underpinned by the sponsor’s diversified investment base, spanning the textile and real estate sectors. Beacon Impex has no formal board, and all authority lies with the CEO.
Pakistan’s textile exports reached USD 17.9bln in FY25, reflecting a 7.2% year-on-year growth from FY24. The largest contribution came from the composite and garments segment. The production of cotton cloth declined marginally by approximately 0.7% year-on-year in FY25, with approximately 25.3% exported (FY24: 27.2%). The textile & apparel sector recorded approximately USD 3.21bln in exports during July–August 2025, up approximately 10% year-on-year. In FY25, the Company’s topline surged to PKR 12,077mln, reflecting a robust YoY growth of 32% (FY24: PKR 9,151mln), translating into a three-year average growth rate of 13.4%. Gross profit stood at PKR 2,729mln, representing a gross margin of 22.6% (FY24: 22.5%), reflecting stable cost management. The net profit margin, however, compressed to 1.4% (FY24: 2.2%), driven primarily by a significantly elevated tax charge arising from the transition to the normal tax regime.
In light of prevailing geopolitical tensions and the consequent moderation in export orders, topline growth is expected to remain under pressure in FY26. The Company's strategic pivot into the home textile segment is, therefore, viewed as a timely diversification move aimed at cushioning the revenue impact and sustaining overall business momentum. The Company has successfully commissioned a 1MW solar power plant at the Sindh Industrial Estate facility, bringing its total installed solar capacity to 3.25MW, a meaningful contribution toward cost optimization and energy sustainability.
The financial risk profile of the Company is considered adequate, with a stretched working capital cycle and a leveraged capital structure. Total borrowings of the Company recorded at PKR 3,836mln (FY24: PKR 1,984mln), increasing the leverage ratio to 52.4% (FY24: 40.3%). Short-term borrowings constitute 92% of total borrowings, reflecting heightened working capital financing requirements. The cashflows and coverages of the Company are maintained at an adequate level. The current ratio improved to 2.2x (FY24: 1.6x), reflecting an improved short-term liquidity position.
The ratings are dependent on the Company's ability to sustain its growth in business volumes while generating sufficient cash flows and maintaining the profitability matrix at an optimal level. The sustainability of margins and improvement in coverages while expanding business volumes remain critical. The adherence to the debt matrix at an optimal level is a prerequisite for the assigned rating.

About the Entity
Crown Textile (Pvt) Limited (“Crown Textile” or "the Company"), the Partnership Concern, was incorporated in Pakistan under the provisions of the Partnership Act, 1932, and registered with the Federal Board of Revenue on June 14, 2004, as an Association of Persons (AOP). The Company produces over 1mln ready‐made garments per month and operates with a capacity of 101 knitting machines. Mr. Muhammad Nadeem owns 98% of the stake, and the rest is with his wife. The position of CEO is vested in Mr. Nadeem. He has more than 3 decades of experience in the textile industry.