PACRA Assigns Positive Outlook to Ghani Chemical Industries Limited

Ghani Chemical Industries Limited (GCIL or "the Company") is engaged in the manufacturing, sale, and trading of industrial and medical gases, including liquid and compressed oxygen, nitrogen, and argon. The Company serves a diversified client base spanning healthcare, oil and gas, steel, chemicals, pharmaceuticals, food and beverages, and general manufacturing. GCIL operates four air separation units (ASUs) across Lahore and Port Qasim, Karachi, with an aggregate installed capacity of approximately 710 tons per day (TPD), complemented by the recently operationalized 275 TPD facility at Hattar Special Economic Zone. The Hattar plant, among the most modern ASUs in the country, has meaningfully enhanced operational scale, energy efficiency, and cost absorption across the production base. Following the completion of the Calcium Carbide segment demerger into a separately listed entity, the Company's revenue base is now fully concentrated in the core gases, distributed between the industrial segment (~65%) and the medical segment (~35%). As per management’s representation, GCIL commands an estimated market share of 40%, consolidating its position as the leading domestic producer. Pakistan's industrial and medical gases sector continues to demonstrate structural resilience. Demand for medical gases is supported by expanding hospital networks, growing healthcare infrastructure investment, rising surgical volumes, and increasing adoption of piped medical gas systems across institutional healthcare facilities. The industrial segment remains closely linked to large-scale manufacturing (LSM) activity, encompassing steel processing, automobile production, engineering and fabrication, and CPEC-related industrial projects. Moderating policy rates, easing inflationary pressures, and a more stable exchange rate environment are expected to provide incremental support to industrial demand going forward. Sector performance overall remains positively correlated with the trajectory of healthcare investment and the pace of LSM recovery. During 9MFY26, the Company recorded a net revenue of PKR 6.0 billion, reflecting a sizeable growth driven by disciplined pricing and stronger demand realization across both product segments. Furthermore, the margin materially strengthened at all levels. These improvements reflect the combined effect of an optimized pricing strategy, operating leverage from expanded capacity, and energy efficiencies embedded in the Hattar facility. The Positive Outlook reflects the consistent topline growth trajectory, material margin improvement, and strengthening competitive positioning. Diversification into LNG and CO₂ production through the joint venture with Mari Energies Limited, the exclusive agreement with Precision UK for medical gas pipeline systems, and the planned LPG storage facility at Phool Nagar further broaden the Company's revenue and growth horizon. GCIL operates under the oversight of a strategic governing board and an experienced management team. The financial risk profile is characterized by comfortable coverage metrics, adequate liquidity, and a manageable working capital cycle. The capital structure is moderately leveraged, with long-term facilities supporting capacity investment and short-term borrowings addressing working capital requirements.
The ratings are dependent upon the Company's ability to sustain topline growth, with stability in margins, effectively utilize enhanced capacities, and maintain disciplined management of financial risk, particularly leverage and debt coverage ratios. Successful execution of diversification initiatives and consistent growth in market share would be supportive of a positive rating action.

About the Entity
Ghani Chemical Industries Limited is a listed entity, incorporated in 2015. The Company is a subsidiary (~49.07%) of Ghani Global Holdings Limited which is owned majorly by the Ghani Family (~51.89%). The remaining shareholding lies in Ghani ChemWorld Ltd. ~12.27%, directors of the Company and the general public. Mr. Masroor Ahmad Khan is the Chairman of the board while Mr. Hafiz Farooq Ahmad holds the office of CEO. They are assisted by a management team with extensive experience and a diversified skillset.