PACRA Maintains the Entity Ratings of Packages Limited

The assigned ratings of Packages Limited ('Packages' or 'the Company') reflect its entrenched position as the apex holding entity of a well-diversified, multindustry conglomerate with a track record spanning over seven decades. The Company's credit profile is anchored by a strong investment profile. The Company continued its commitment to optimizing the capital structure of its subsidiaries and executing a disciplined long-term value creation strategy, which bodes well for the assigned rating. As of December 2025, the Company’s shareholders’ equity stood at PKR 56.4bln (December 2024: PKR 55.2bln), reflecting a modest improvement in net asset value. The investment portfolio comprises strategic holdings in Nestlé Pakistan Limited, Packages Convertors Limited, Tri-Pack Films Limited, Bulleh Shah Packaging (Private) Limited (“BSPL”), DIC Pakistan Limited, Packages Real Estate (Private) Limited, Packages Lanka (Private) Limited, StarchPack (Private) Limited (“SPL”), Packages Trading FZCO, Hoechst Pakistan Limited, and other investments. Packages has consistently supported its subsidiaries through timely capital injections, strengthening their financial profiles and supporting long-term operational sustainability. Dividend income remains the Company’s primary source of revenue; therefore, its financial performance is closely linked to the dividend-paying capacity of its investee companies. During CY25, dividend income increased by 26% to PKR 5,098mln (CY24: PKR 4,060mln), primarily driven by higher distributions from Hoechst Pakistan Limited, Packages Convertors Limited, Packages Real Estate (Private) Limited, and Nestlé Pakistan Limited. Consequently, profit after tax increased by 60% to PKR 3,054mln (CY24: PKR 1,912mln). However, dividend streams from BSP remained constrained due to the subsidiary's weakened financial performance, driven by elevated raw material costs and increasing competition from imported substitutes.
During CY25, the Company extended substantial financial support to BSPL and SPL as part of ongoing capital restructuring initiatives. In aggregate, PKR 9,750mln was provided through a combination of fresh equity injections and conversion of shareholder loans into equity. For BSPL, PKR 3,200mln was injected as fresh equity, while PKR 4,800mln of outstanding loans was converted into ordinary shares. Similarly, PKR 500mln was injected into SPL as fresh equity, alongside the conversion of PKR 1,000mln of shareholder loans into ordinary shares. These measures are expected to strengthen the capital structures of both entities and support their long-term operational and financial performance.
The Company’s borrowings increased by PKR 10.9bln during CY25, primarily to finance strategic investments and capital support extended to BSPL and SPL. Despite the higher debt levels, finance costs declined by 3% year-on-year, benefiting from the lower interest rate environment. Capital expenditure remained limited at PKR 654.7mln, consistent with the Company’s investment-holding nature. The Board of Directors has recommended a cash dividend of 160% (PKR 16.00 per share) for CY25, reflecting the Company’s continued ability to generate cash flows from its investment portfolio.
The Company’s robust financial standing, supported by prudent leveraging and a strong balance sheet, underpins its credit ratings. The proven track record, strategic vision and business acumen of the Sponsors further reinforce the Company’s resilience and long-term sustainability.

About the Entity
Packages Limited, a listed concern, was established to convert paper and paperboard into consumer packaging in 1957. The Company is classified as an investment holding company and has continued to enhance its investment book to meet the growing demand in the FMCG sector. Ali Group holds ~68.78% shares of the Company through Directors, individual family members, and its corporates; with IGI Investments (Pvt.) Ltd. owning the prime share. The Company has a free float of ~29.85%. Mr. Syed Babar Ali provides guidance, while Mr. Syed Hyder Ali heads the Company as its CEO/MD. They are supported by a team of experienced professionals.