Hi-Tech Feeds (Pvt.) Limited ('Hi-Tech Feeds' or 'the Company') was incorporated in 1985 as a Private Limited Company.

Hi-Tech Feeds (Pvt.) Limited is a prominent venture of Hi-Tech Group. The Group is a well-known player of Pakistan’s poultry industry. In 1980, the Group started from a small-scale poultry breeder business. Later, it diversified vertically across the poultry supply chain and set up poultry feed mills, poultry farms/hatcheries, rice processing unit and an edible oil mill. The Group has also set up a pharmaceutical unit providing poultry vaccines (live and killed) and medicines. Group's registered office is located in Shadman Chowk, Jail Road, Lahore. While, Unit I is situated on Raiwind Road Lahore and Unit II is situated on Arifwala Road, Sahiwal. Hi-Tech Feeds commenced operations in 1985 with the establishment of its first feed mill in Lahore, which has since been relocated to Sahiwal. A second feed mill was commissioned in Sahiwal in 2009. The Company specializes in the production and sale of poultry feed for breeder chicks, broilers, and layers. Currently, the Company has 200 permanent employees and 400-1000 contractual employees depending upon the seasonal nature of the business

Hi-Tech Feeds’ is primarily engaged in the production and sale of poultry feed for breeder chicks, broiler and layers. The Company has two feed production units. Unit I and manufactures feed at an installed capacity of 100 metric ton per hour. While Unit II has an installed capacity of 90 metric ton per hour. Being a part of one of the leading poultry groups in the region, the Company is well equipped with the modern state of art technologies and not compromising on the quality manufacturing. The Company’s annual production profile is shown in the adjacent table. The Company maintains a high Feed Conversion Ratio (FCR) of 1.5x. This indicates the good quality of feed supplied in market and to the Company’s own broiler and layer farms.

Hi-Tech Feeds, like other Group Companies, is equally owned by veterinary professionals Dr. Muhammad Arshad, Dr. Abdul Qayyum, Dr. Muhammad Asim Khan, and Dr. Anwar Mahmood Randhawa, each holding a 25% ownership stake.

The ownership structure of Hi-Tech Group is considered stable, as the Sponsors hold equal ownership stakes in the business, ensuring a balanced and unified approach to decision-making and long-term strategic planning. This stability is further reinforced by the recent involvement of the second generation, who have joined the Group’s leadership team. Their participation not only strengthens the continuity of leadership but also brings fresh perspectives and innovative ideas, positioning the Group for future growth and success. This generational transition underscores the Group’s commitment to maintaining strong governance and leadership while adapting to evolving market dynamics.

Hi-Tech Group commenced its business operations in 1980, with its inaugural venture being Hi-Tech Feeds (Pvt.) Limited. Over the years, the Group expanded its footprint by establishing several business entities across the poultry supply chain, positioning itself as a key player in the industry. The Sponsors of Hi-Tech Group have navigated through multiple business cycles, accumulating a wealth of experience and expertise along the way. Their deep understanding of the market dynamics and their innovative approach have contributed to their recognition as pioneers within the poultry industry. This rich history and expertise continue to drive the Group’s success and growth.

The Sponsors of Hi-Tech Group possess significant financial strength, which has been a key factor in the Group's ability to expand and diversify its operations. Leveraging this financial foundation, the Group has established multiple business entities spanning various segments of the poultry supply chain. This strategic diversification enables the Group to capture synergies across the supply chain, enhancing operational efficiency and market competitiveness. The Sponsors' financial capabilities and strategic foresight have played a pivotal role in driving the Group’s growth and success in the poultry industry.

Hi-Tech Feeds BoD comprises four Executive Directors, who are also the Sponsors of the Company. Absence of non-executive Director and lack of independent oversight indicates room for improvement in the Company’s governance framework

The Board of Directors of Hi-Tech Group comprises four distinguished professionals, all holding Doctor of Veterinary Medicine (DVM) degrees and possessing extensive expertise in the poultry and allied industries. Their collective experience and leadership continue to drive the organization's success and growth. Dr. Muhammad Arshad brings over 44 years of experience in the poultry and integrated agribusiness sectors. He began his career as a Lecturer at Faisalabad University from 1976 to 1980 before transitioning to entrepreneurial ventures in edible oils, animal feeds, and grains. Currently serving as the Chief Executive Officer (CEO) of Hi-Tech Group, Dr. Arshad leverages his vast industry knowledge and leadership to spearhead the company’s strategic initiatives. Dr. Anwar Mehmood Randhawa served as a Production Manager at Olympia from 1974 to 1980, gaining valuable expertise in operational management. He subsequently diversified his experience in areas such as chicks, pharmaceuticals, and poultry farming. As the Managing Director of Hi-Tech Group, Dr. Randhawa plays a critical role in enhancing the company’s operational efficiency and strategic growth. Dr. Muhammad Asim started his professional journey with Hybrid Chicks, where he worked from 1975 to 1980. He later established and managed his own business, building extensive expertise in the chicks and poultry sectors. Currently, as the Managing Director of Hi-Tech Group, Dr. Asim’s strategic insights and industry acumen have proven invaluable to the organization’s success. Dr. Hafiz Abdul Qayyum began his career as a Sales Manager at Olympia from 1973 to 1980. He subsequently gained significant experience in the animal feeds industry. As a Managing Director of Hi-Tech Group, Dr. Qayyum utilizes his extensive knowledge and leadership skills to contribute to the company’s ongoing growth and success. Together, these seasoned professionals form a dynamic leadership team that ensures Hi-Tech Group remains at the forefront of the industry.

The Board of Directors meets informally to discuss important issues and make strategic decisions, with the majority of members typically in attendance. However, it is important to note that formal minutes of these meetings are not consistently recorded. Additionally, the Company currently does not have any established sub-committees to oversee specific areas of governance or operations, which could potentially enhance the decision-making process and provide more focused oversight. The absence of formal meeting documentation and sub-committees highlights areas for improvement in the Company's governance framework.

Hi-Tech Feeds' external auditors, M/s Hameed Zahid & Co. Chartered Accountants, have expressed an unqualified opinion on the financial statements of the Company for the year ended June 30, 2023. The firm has been QCR rated by ICAP but is not in the SBP's panel of auditors.

Hi-Tech Feeds operates through six departments; Procurement, Production, Marketing and Sales, Finance, Information Technology and Tax. The Company’s feed mills are monitored by their GM Productions. All Departmental Heads report to the Company’s CEO, who then makes pertinent decisions. As the Company’s CEO makes key decisions, reliance on him remains high.

The management team at Hi-Tech Feeds is highly efficient and well-qualified, with a strong foundation built by its leadership. Dr. Muhammad Arshad, the CEO of Hi-Tech Feeds, is the visionary founder of the Group and was instrumental in establishing Hi-Tech Feeds. With extensive experience in the poultry, feed milling, and veterinary pharmaceutical industries, he actively participates in both international and local seminars, sharing his insights and expertise. Mr. Muhammad Usman, the Chief Financial Officer (CFO), brings 15 years of comprehensive experience in financial management. His strategic oversight and financial acumen play a vital role in driving the Company’s financial growth and stability. Mr. Muhammad Tahseen, a qualified Doctor of Veterinary Medicine (DVM), serves as the General Manager (GM) of Production. With 25 years of experience in the field, he oversees production operations and ensures the highest standards of quality and efficiency within the Company. Mr. Muhammad Raza Younis, also a qualified DVM, has an impressive 25 years of experience and currently serves as the GM of Sales. His expertise in sales management and market expansion has been instrumental in driving the Company’s growth and enhancing its market presence. Mr. Anas Wahab, a Chartered IT Professional (CITP), serves as the Chief Technology Officer (CTO) with 17 years of experience in technology management. His leadership in the IT domain ensures that Hi-Tech Feeds stays at the forefront of technological advancements, supporting operational efficiency and innovation. Mr. Hafiz Abdul Samad, holding a B.Sc. degree, serves as the Director of Marketing and Sales. With a decade of experience in marketing strategy and sales management, he is responsible for driving the Company’s marketing efforts and enhancing its customer base. Together, this highly qualified and experienced management team plays a crucial role in Hi-Tech Feeds' continued success and industry leadership.

There are no formal Management committees. However, pertinent matters are discussed among the four Directors/Sponsors or departmental heads as per requirement. No formal documentation of these discussions is maintained.

Hi-Tech Group has developed a bespoke software solution in-house, tailored to meet the specific needs of the Company. This custom-built software efficiently monitors and tracks key operational areas, including inventory management, sales, and receivables. It provides real-time data and generates detailed reports, enabling management to make informed decisions and optimize operational performance. The system enhances transparency, streamlines workflows, and ensures accurate monitoring of critical business processes, ultimately supporting the Company’s strategic objectives and improving overall operational efficiency.

To maintain and enhance operational efficiency, Hi-Tech Group has established a robust internal audit function at the Group level. This function is responsible for implementing and monitoring the Company’s policies and procedures, ensuring compliance with regulatory standards, and identifying areas for continuous improvement. At the operational level, the Company employs a comprehensive quality assurance process. Samples of maize, meals, medicines, and manufactured feed variants undergo rigorous testing in a state-of-the-art laboratory. These tests are conducted to ensure that all products meet the highest quality standards, thereby safeguarding the Company’s reputation and ensuring the safety and effectiveness of its offerings.

The Pakistan Poultry Association (PPA) highlights the substantial contribution of the poultry industry to Pakistan’s economy. The sector contributes approximately 1.3% to the country’s Gross Domestic Product (GDP) and provides direct and indirect employment to 1.5 million individuals. Annually, the industry produces 1.3 billion kilograms of poultry meat and over 18 billion eggs, serving as a crucial source of affordable protein for the nation’s population. In recent times, the poultry farming sector has encountered significant challenges due to escalating input costs, particularly for poultry feed. This trend is forcing many poultry farmers, especially those operating on a small scale, to contemplate the closure of their businesses. Such a development could have detrimental implications for both the livelihoods of farmers and the local economies reliant on the poultry industry.

Hi-Tech Feeds has secured a prominent position in the poultry feed industry, attributable to its superior feed conversion ratio (FCR) and consequently increased demand for its products. The Company is currently classified as a second-tier player in the market.

Hi-Tech Feeds’ revenue stream is predominantly derived from the sale of poultry feed, which constitutes approximately 91% of its total revenue. Wanda and fish feed contribute 8% and 0.3%, respectively. In the fiscal year 2024, the Company’s revenue experienced a 14% growth, reaching PKR 25 billion compared to PKR 22 billion in the previous fiscal year. This revenue increase is primarily driven by a surge in sales volume and heightened demand for poultry feed.

Hi-Tech Feeds demonstrated notable improvement in profitability metrics during FY24, sup-ported by increased sales volumes and effective cost management, despite macroeconomic challenges, including elevated finance costs. Gross profit margins improved to 9.7% in FY24 (FY23: 7.7%), driven by higher sales and the company’s ability to maintain stable input costs amidst volatile commodity markets. This reflects the Company's operational resilience and pricing strategy in a competitive industry environment. Operating profit margins strengthened to 7.6% in FY24 (FY23: 5.5%), reflecting prudent management of operating expenses alongside increased revenues. Cost control initiatives and economies of scale from higher production levels contributed to this margin expansion, showcasing the company’s focus on operational efficiency. Despite higher finance costs stemming from an increased interest rate environment, net profit margins improved to 3.1% in FY24 (FY23: 2.6%). This highlights the company's ability to mitigate financial pressures through robust top-line growth and improved operational leverage.

High poultry feed prices and recovery of demand due to relaxation in lockdown tends to bode well for the Company. However, the Company is exposed to volatility and ensuing challenges in the feed and poultry sector.

The Company demonstrated improved inventory management during FY24, with average inventory days reducing to 125 days from 132 days in FY23. This improvement reflects enhanced operational efficiency and effective inventory turnover, contributing to better utilization of working capital. Gross working capital days also showed slight improvement, standing at 154 days in FY24 compared to 157 days in FY23. Meanwhile, net working capital days remained stable at 114 days, indicating consistent management of current assets and liabilities to support operational requirements. The Company maintained a robust liquidity position, as evidenced by an ideal current ratio of 3.3x during FY24, an improvement from 2.8x in FY23. This strong liquidity buffer underlines the Company's ability to meet short-term obligations while ensuring operational stability.

The Company’s coverage ratios exhibited notable improvement in FY24, driven by a significant increase in free cash flows from operations (FCFO), which rose to PKR 1.8 billion from PKR 1.2 billion in FY23. This robust growth in FCFO enhanced the Company’s ability to meet its financial obligations, with the core coverage ratio improving to 2.0x in FY24, up from 1.4x in FY23. Total coverage also strengthened, reaching 1.4x in FY24 compared to 1.0x in FY23, further underscoring the positive impact of improved cash flows on the Company’s financial stability. Additionally, the debt payback ratio improved significantly, reducing to 1.3x in FY24 from 3.4x in FY23. This reduction highlights the Company’s enhanced ability to repay debt using operational cash flows, reflecting strengthened liquidity and financial resilience. Overall, while the leverage ratio reflects a steady position, the high proportion of short-term borrowings underscores the importance of maintaining robust liquidity to manage short-term obligations effectively. Continued focus on optimizing the capital structure and exploring long-term financing options could further enhance financial stability.

The Company maintained a relatively stable leverage position, with a slight reduction in its leverage ratio to 34% during FY24 from 35% in FY23. This indicates that the Company effectively manages its debt levels relative to its equity. However, the total borrowings increased slightly to PKR 4.7 billion in FY24, compared to PKR 4.5 billion in FY23, reflecting a modest increase in overall financing requirements. The Company’s debt profile is heavily weighted towards short-term borrowings, which represent 77% of total borrowings. While this reliance on short-term financing provides flexibility in meeting immediate operational and working capital needs, it also exposes the Company to re-financing and liquidity risks, especially in a high-interest-rate environment. Overall, the stable leverage ratio is a positive indicator of the Company’s disciplined approach to debt management. However, the reliance on short-term debt requires careful monitoring to ensure liquidity remains sufficient to cover short-term obligations. To strengthen its financial position, the Company could benefit from diversifying its debt structure by increasing the share of long-term financing, reducing refinancing risks and supporting long-term growth initiatives.