PACRA Maintains Entity Ratings of Neelum Oil and Ghee Industries (Pvt.) Limited

The ratings reflect Neelum Oil & Ghee Industries (Pvt.) Limited's or ("the Company") strong operational performance and its strategic association with Waheed Group of Companies ("the Group"). The Group has established a leading position in the edible oil and ghee sector, comprising its specific markets. There are five principal operating companies, in this group: Waheed Hafeez Ghee Industries (Pvt.) Ltd., Khadija Edible Oil Refinery (Pvt.) Ltd., Neelum Oil& Ghee Industries (Pvt.) Ltd., AK Oil and Ghee Industry (Pvt) Ltd. and Lal Oil & Ghee Mills (Pvt.) Ltd, with a combined installed production capacity exceeding 850,000 million tons per annum, providing meaningful operational synergies and scale advantages.
During FY25, the Company demonstrated a strong financial performance, reporting a turnover of PKR 36,170 million, representing approximately 10% growth from PKR 32,968 million in FY24. This growth is underpinned by the expanding brand equity of the Company's flagship products—including Fauji Supreme, Islamabad, and Phool, and a deliberate strategy to deepen market penetration across northern Pakistan. Profitability metrics showed a marked improvement, despite elevated raw material costs, with the gross margin expanding to 2.6% (FY24: 2.1%) and the net profit margin rising to 2.4% (FY24: 1.9%). The Company’s financial risk profile remains well-managed, supported by a conservative capital structure and disciplined liquidity management. Total borrowings stood at PKR 1,781 million as of FY25 (FY24: PKR 1,060 million), comprising entirely short-term facilities utilized for working capital and import financing. The leverage ratio stood at 38.5% (FY24: 34.9%), primarily to support expanded import volumes rather than any structural increase in financial risk. EBITDA strengthened to PKR 901 million (FY24: PKR 657 million), while finance costs remained negligible, reinforcing the Company's strong debt-servicing capacity. The Company continues to benefit from a centralized finance function that ensures rigorous oversight across Group entities.
Looking ahead, the ratings remain sensitive to the Company's ability to sustain its market share and margins in a volatile commodity environment. Brand reputation and customer retention support the ratings. However, strategic backing from the Waheed Group and the prospective institutionalization of board committees to bolster governance remain pivotal credit factors.

About the Entity
Neelum Oil & Ghee Industries (Pvt.) Limited (the 'Company') was incorporated in 2019 under the Companies Act, 2017, as a Private Limited Company. The Company is primarily engaged in the production and sale of refined, branded cooking oil and ghee. Its manufacturing facility is located in Mirpur, Azad Kashmir, with an installed annual production capacity of 108,000 MT. The Company’s ownership is divided as follows: Awais Karni holds 65.68%, Faad Waheed holds 17.07%, Hamad Waheed holds 17.25%, and Javed Iqbal Chaudhary holds 0.00017%. The CEO, Mr. Awais Karni, is supported by a team of experienced professionals.