DIC Pakistan Limited

RATING REPORT | Jun-26

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Rating History
Dissemination Date Long-Term Rating Short-Term Rating Outlook Action Rating Watch
18-Jun-26 AA- A1 Stable Maintain -
25-Nov-25 AA- A1 Stable Maintain -
25-Nov-24 AA- A1 Stable Maintain -
23-Nov-23 AA- A1 Stable Maintain -
23-Nov-22 AA- A1 Stable Initial -
About the Entity

DIC Pakistan Limited was incorporated as a public limited Company in July 1994 as a Joint Venture between DIC Asia Pacific Limited and Packages Limited by holding 45% and 55% shares respectively. Syeda Henna Babar Ali is the Chairperson of the Board and Mr. Ismail Hussain Naqvi is the CEO of the Company. Mr. Ismail joined DIC as COO in Jun'19 and took over as CEO from Jan'21. He has more than 27 years of diversified professional experience in various positions in different companies.

Rating Rationale

The assigned ratings reflect DIC Pakistan Limited's ("DIC" or the "Company") strong sponsor profile, established market position and sound financial footing. The ratings also take comfort from its good governance framework, strong control environment, and an experienced management team. DIC is predominantly engaged in the manufacturing of a range of printing inks, with production closely tied to the demand for food products and other consumer goods. Since CY24, Pakistan’s paper and packaging industry has faced margin pressures due to rising energy costs and higher imported raw material prices. Despite these challenges, demand for packaging from the FMCG and food sectors is expected to sustain moderate production growth, with the industry outlook remaining stable, supported by sustainability initiatives and recycling trends. DIC Pakistan Limited has taken proactive measures to navigate this environment, including rationalizing sales prices and diversifying its product portfolio. DIC expanded its offerings by introducing textile inks and wood coatings during CY25 to support topline growth and sales volumes to remain competitive in the industry. As per management, DIC Pakistan Limited commands an estimated 36% market share in the country’s printing ink industry and remains the major domestic manufacturer of printing inks in Pakistan. The remaining market is catered to by commercial importers along with captive manufacturers fulfilling their internal production requirements. DIC continues to derive a competitive advantage from its strong market reputation, diversified product portfolio, and well-established after-sales service network. During CY25, the Company reported an annualized production capacity of 17,798 tons (CY24: 17,095 tons), alongside a slight increase in actual production to 10,467 tons (CY24: 10,166 tons). Accordingly, the capacity utilization ratio remained stable at 59%, unchanged from the preceding year.
On the financial front, the Company recorded a minor increase of 6% in topline to PKR 12.4bln during CY25 (CY24: PKR 11.7bln). Rotogravure ink continues to be the leading revenue contributor, accounting for ~50%, followed by Flexographic Ink-Water based at ~12%. During CY25, the Company's profit after tax was recorded at PKR 776mln compared to PKR 972mln last year. The decline in bottom-line profitability was mainly due to operating costs. The strong group structure and associated synergies have helped the management in reaping the benefits of catering to higher demand with effective inventory management. During CY25, leverage of the Company increased to 70% (CY24: 67%), an increase was noticed due to an increase in long-term loan of PKR 1.1bln to support Kasur project. The Company has successfully relocated all of its production facility from Lahore to Kasur as part of its business expansion and operational optimization strategy. The inauguration ceremony of the Kasur plant was held on Oct 22, 2025. The total project cost has been entirely financed through debt. According to management, the relocation has been completed and full-scale production of all ink types at the Kasur facility has also started from December 2025. As of CY25, equity of the Company stood at PKR 2.5bln (CY24: PKR 2.4bln).

Key Rating Drivers

The Parent Company’s continued commitment to support the Company in times of financial need remains firm. Ratings depend on the management’s ability to enhance margins while maintaining market share, ensuring prudent working capital management, and sustaining adequate cash flows and coverages. Any notable decline in margins or coverages may exert pressure on the ratings.

REPORT CONTENTS
  1. Rating Analysis
  2. Financial Summary
  3. Rating Scale
  4. Regulatory Disclosure

DIC Pakistan Limited


Rating Analysis

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Profile
Legal Structure

DIC Pakistan Limited (“DIC” or “the Company”) was incorporated as a public listed Company in July 1994 and is engaged in the manufacturing and sale of high-quality printing inks and chemicals.


Background

The Company was established as a joint venture between DIC Asia Pacific Limited and Packages Limited, holding approximately 45% and 55% shares respectively. Over time, DIC has strengthened its position as a key supplier to the domestic packaging industry.


Operations

DIC is engaged in manufacturing of printing inks for packaging sector in Pakistan. These inks include solvent-based liquid ink, water based liquid inks and sheetfed offset paste inks. During CY25, the Company reported an annualized production capacity of 17,798 tons (CY24: 17,095 tons), alongside a slight increase in actual production to 10,467 tons (CY24: 10,166 tons).


Ownership
Ownership Structure

The majority stake in DIC Pakistan Limited is held by Packages Limited, which owns approximately 55% of the shares, while the remaining ~45% of the shares are owned by DIC Asia Pacific Limited.


Stability

Packages Limited is the flagship investment holding company of the Ali Group, with a legacy spanning over 67 years. Its investment portfolio includes entities involved in manufacturing and sale of inks, flexible packaging material, paper, paperboard, corrugated boxes, biaxially oriented polypropylene film and cast polypropylene films, ground calcium carbonate products, as well as businesses in insurance, power generation, pharmaceutical, real estate, and corn-based starch manufacturing sector.


Business Acumen

The Group is ranked amongst the leading industrial groups of the Country with interests in paper and paperboard, packaging, financial institutions, education, and real estate sectors. Packages Limited has significant successful joint ventures with international conglomerates and long standing relationships with various multinational companies.


Financial Strength

Packages Limited has a consolidated asset base of ~PKR 267bln supported by ~PKR 86bln of equity and generated a turnover of ~PKR 260mln during CY25.



Governance
Board Structure

The Company has a seven-member Board comprising six non-executive directors, and one executive directors. The Board is chaired by non-executive director Ms. Syeda Henna Babar Ali. The Board comprises four representatives from Packages Limited, including the CEO, and three representatives from DIC Asia Pacific Limited.


Members’ Profile

The Board, with its diverse backgrounds and relevant expertise, provides vital oversight and guidance to the management. Ms. Syeda Henna Babar Ali - Chairperson brings extensive experience to DIC, having joined Packages Limited in 1990 as a Product Manager. She is also an advisor of the Packages Group Advisory Committee. Mr. Syed Aslam Mehdi - Non- Executive Director joined Packages Limited in 1980. He was General Manager of Packages Limited and Managing Director of DIC Pakistan Limited. Currently he holds directorship of Packages Limited, Bulleh Shah Packaging (Pvt) Ltd., Packages Lanka (Pvt) Ltd. and Packages Real Estate (Pvt.) Limited. Mr. Khurram Raza Bakhtayari - Non- Executive Director has vast experience in financial planning and budgeting, financial forecasting and analysis, asset investment and taxation. He also holds directorship in Bulleh Shah Packaging (Pvt ) Ltd., Packages Lanka (Pvt) Ltd., IGI Investment Bank Ltd., IGI Life Insurance Co. Ltd. He currently holds the position of Chief Financial Officer of Packages Limited and CEO of Packages Real Estate (Pvt.) Limited. Mr. Navapol Chuensiri is the Deputy Regional Managing Director of DIC Asia Pacific Pte Ltd (DICAP) with over 30 years of leadership experience across multinational companies, including SIG Combibloc, Tetra Pak, Amcor, Goodyear Tyre & Rubber, and O-I Glass. He brings extensive international expertise and has previously served on the boards of SIG Combibloc and O-I Glass. He holds Bachelor's and Master's degrees in Mechanical Engineering from Oregon State University, USA, along with a Master's degree in Organizational Communication. Mr. Hayato Kashiwagi - Non- Executive Director brings with him a wealth of experience of working with Group companies in Japan, Asia Pacific and China region on various projects. He is also a director of DIC Malaysia SdnBhd, PT DIC Graphics, DIC Philippines Inc, DIC Vietnam Co. Ltd, DIC Bangladesh Private Limited, DIC Australia Pty Ltd, DIC India Ltd., and DIC Lanka (Private) Limited. Mr. Lee Ji Xiang Jason - Non- Executive Director serves as the Regional Internal Audit Director at DIC Asia Pacific Pte Ltd (“DICAP”), overseeing governance, internal controls, and audit functions across DIC companies in the Asia Pacific region. With over fifteen years of experience in income tax, financial, operational, and compliance audits, Mr. Jason possesses extensive expertise in risk management and mitigation. He also holds a directorship at DIC India Limited.


Board Effectiveness

The Board met four times during CY25, with the majority attending to discuss pertinent matters. To ensure effective governance, the Board has formed two committees, namely, (i) Audit Committee and (ii) HR Committee


Financial Transparency

The external auditors, M/s A.F. Ferguson & Co. classified in the “A” category on the SBP’s panel of auditors, have issued an unqualified opinion on the AMC’s financial statements for the period ended CY25.




Management
Organizational Structure

The Company has established a well-defined management structure divided into functional departments with clear lines of responsibilities.


Management Team

Mr. Syed Muhammad Ismail Hussain Naqvi - CEO joined DIC as Chief Operating Officer in June 2019 and took over as CEO from January 1, 2021. Previously, he served as Business Manager at AkzoNobel Pakistan Limited, Country Manager at Buhler Holding AG, and Senior Manager of Business Development at Descon Engineering Limited. He has also worked at Applied Materials in USA for 10 years in various technical and managerial positions before moving to Pakistan in 2008. Ms. Mehreen Zafar - Chief Financial Officer and Company Secretary is a Fellow Member of ICAP with over 14 years of post qualification experience in varying lines of services including financial management, budgeting, strategic business planning, corporate compliance, and risk management operations.


Effectiveness

The expertise of the professional management team has enabled the Company to streamline operations and reduce costs. The production facilities generate minimal wastage, which is effectively managed through recycling and reuse, minimizing overall losses.


MIS

To generate MIS and operational reports, ERP software, S/4 Hana is used which is implemented in Packages group.


Control Environment

To ensure operational efficiency, the in-house internal audit function is in place that identifies and reports risks. The audit committee reviews the internal audit department reports and planned activities.      


Business Risk
Industry Dynamics

The packaging industry in Pakistan is categorized into four primary segments: paper, plastic, tinplate, and glass. Among these, the paper and plastic segments dominate the market, holding the largest share of total demand. The direct costs in these segments are heavily influenced by imported raw materials, with chemical wood pulp being a key input for paper packaging production. In the domain of packaging inks, the market comprises Rotogravure, Flexographic-Solvent/UV, Flexographic-Water-based, and Offset inks. Rotogravure ink leads the market due to its versatility and suitability for a wide range of packaging applications.


Relative Position

DIC Pakistan Limited enjoys the large market share of 36% in the local printing inks industry. 


Revenues

The Company’s core revenue stream is derived from the sale of printing inks, with the majority of its sales concentrated in the domestic market. During CY25, the Company reported a significant increase in revenue, which stood at PKR 12,417mln compared to PKR 11,749mln in CY24. Rotogravure ink continues to be the leading revenue contributor, accounting for ~50%, followed by Flexographic Ink-Water based at ~12%. This improvement was primarily driven from sustained demand from the food and consumer goods sectors, coupled with the Company’s strong market positioning and established customer relationships.


Margins

 At the end of CY25, the gross profit of the Company showed a minor dip to stand at PKR 2,528ln (CY24: PKR 2,669mln). Despite revenue growth, profitability declined, with profit after tax recorded at PKR 776mln at the end of CY25 compared to PKR 972mln in CY24. The decline in bottom-line profitability was primarily attributable to increased operating expenses, including higher administrative and distribution costs, which partially offset the benefits of revenue growth.


Sustainability

The Company continues to maintain a strong brand presence, particularly within the consumer products segment, and is actively expanding its footprint in the printing inks industry. As part of its strategic growth initiatives, the Company relocated its production operations from Lahore to Kasur. This relocation is aimed at enhancing operational efficiency, optimizing production capacity, and positioning the Company closer to distribution networks. The move is also expected to support long-term scalability and cost-effectiveness in meeting the growing market demand. The total project cost has been entirely financed through debt. The Company imported advanced machines from China and Malaysia, including ink dispensers, grinders, and related production units. The Company has successfully relocated all of its production facility from Lahore to Kasur as part of its business expansion and operational optimization strategy. The total project cost has been entirely financed through debt. According to management, the relocation has been completed and full-scale production of all ink types at the Kasur facility has also started from December 2025.



Financial Risk
Working capital

The Company's working capital management is supported by a short-term running finance facility from a consortium of banks. Due to DIC's raw material lead time and high product demand, DIC's inventory days stood at 77 days during CY25 increasing from 82 days in CY24. The trade receivable days stood at 72 days during CY25. (CY24: 63 days). While trade payable days stood at 50 days during CY25 increasing from 48 days in CY24. Consequently, the Company’s net working capital days stood at 100 days during CY25 increasing from 98 days in CY24.


Coverages

The Company's interest coverage ratio stood at 6.6x at the end of CY25 (CY24: 6.4x). The Company's total debt service coverage stood at 3.3x at the end of CY25 (CY24: 3.8x)


Capitalization

DIC’s capital structure has moderately leveraged, with total borrowings of approximately PKR 5,965mln (CY24: PKR 4,835mln) and equity of PKR 2,464mln , resulting in a leverage ratio of ~70.9%.


 
 

Jun-26

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DIC Pakistan Limited


Financial Summary

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(PKR mln)


 Dec-25
12M		 Dec-24
12M		 Dec-23
12M
A. BALANCE SHEET
1. Non-Current Assets 5,072 3,589 1,218
2. Investments 0 0 0
3. Related Party Exposure 0 0 0
4. Current Assets 5,809 5,627 4,533
a. Inventories 2,461 2,796 2,502
b. Trade Receivables 2,589 2,341 1,728
5. Total Assets 10,881 9,216 5,751
6. Current Liabilities 1,882 1,791 1,798
a. Trade Payables 1,746 1,659 1,414
7. Borrowings 5,965 4,835 1,476
8. Related Party Exposure 29 7 11
9. Non-Current Liabilities 541 173 74
10. Net Assets 2,464 2,411 2,393
11. Shareholders' Equity 2,464 2,411 2,393
B. INCOME STATEMENT
1. Sales 12,417 11,750 10,632
a. Cost of Good Sold (9,889) (9,080) (7,648)
2. Gross Profit 2,528 2,669 2,984
a. Operating Expenses (580) (537) (444)
3. Operating Profit 1,948 2,133 2,541
a. Non Operating Income or (Expense) (183) (84) (453)
4. Profit or (Loss) before Interest and Tax 1,765 2,049 2,088
a. Total Finance Cost (339) (346) (212)
b. Taxation (651) (730) (809)
6. Net Income Or (Loss) 776 972 1,067
C. CASH FLOW STATEMENT
a. Free Cash Flows from Operations (FCFO) 1,459 1,299 1,911
b. Net Cash from Operating Activities before Working Capital Changes 1,138 1,014 1,758
c. Changes in Working Capital 144 (770) (758)
1. Net Cash provided by Operating Activities 1,283 244 999
2. Net Cash (Used in) or Available From Investing Activities (1,643) (2,502) (758)
3. Net Cash (Used in) or Available From Financing Activities 478 1,085 (297)
4. Net Cash generated or (Used) during the period 117 (1,172) (56)
D. RATIO ANALYSIS
1. Performance
a. Sales Growth (for the period) 5.7% 10.5% 13.5%
b. Gross Profit Margin 20.4% 22.7% 28.1%
c. Net Profit Margin 6.2% 8.3% 10.0%
d. Cash Conversion Efficiency (FCFO adjusted for Working Capital/Sales) 12.9% 4.5% 10.8%
e. Return on Equity [ Net Profit Margin * Asset Turnover * (Total Assets/Shareholders' Equity )] 31.8% 40.5% 50.6%
2. Working Capital Management
a. Gross Working Capital (Average Days) 150 146 141
b. Net Working Capital (Average Days) 100 98 91
c. Current Ratio (Current Assets / Current Liabilities) 3.1 3.1 2.5
3. Coverages
a. EBITDA / Finance Cost 6.6 6.4 12.2
b. FCFO / Finance Cost+CMLTB+Excess STB 3.3 3.8 8.1
c. Debt Payback (Total Borrowings+Excess STB) / (FCFO-Finance Cost) 3.1 2.4 0.0
4. Capital Structure
a. Total Borrowings / (Total Borrowings+Shareholders' Equity) 70.9% 66.8% 38.3%
b. Interest or Markup Payable (Days) 148.6 139.7 136.6

Jun-26

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DIC Pakistan Limited


Rating Scale

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Jun-26

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DIC Pakistan Limited


regulatory disclosure

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  1. Rating Team Statements
    1. Rating is just an opinion about the creditworthiness of the entity and does not constitute a recommendation to buy, hold, or sell any security of the entity rated or to buy, hold, or sell the security rated, as the case may be. (Chapter III; 14-3-(x))
    2. Conflict of Interest
      1. The Rating Team or any of their family members have no interest in this rating (Chapter III; 12-2-(j))
      2. PACRA, the analysts involved in the rating process, and members of its rating committee and their family members do not have any conflict of interest relating to the rating done by them (Chapter III; 12-2-(e) & (k))
      3. The analyst is not a substantial shareholder of the customer being rated by PACRA [Annexure F; d-(ii)]
      4. Explanation: for the purpose of the above clause, the term "family members" shall include only those family members who are dependent on the analyst and members of the rating committee.
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