Rainbow Hosiery Private Limited (“Rainbow Hosiery”, “the Company” or “RHPL”) was established in the year 1992. The company registered office is in sector-16b Malik Anwar Goth North Karachi Industrial Area, Karachi. The company's registered office spans across four floors.

The company has been operational for over 31 years. Initially, its activities were limited to local dyeing services for exporters. However, following 2010, the company expanded its operations to include the export of its products to various international markets, including Europe, Germany, the United States, the United Kingdom, South Africa, and Australia. This strategic expansion has contributed to the company’s growth and broader market presence.

The company operates in the home textile and garments sector. Rainbow Hosiery is recognized for its high-quality products, innovative designs, and competitive pricing. It operates five textile manufacturing units, all equipped with advanced, state-of-the-art machinery that ensures a streamlined and efficient production process. In the garments segment, RHPL offers a range of products including sweatshirts, polo shirts, creepers, hooded jackets, and other premium apparel. These garments are produced using cotton, blended, and mixed fabrics, and can be customized in terms of size and color to meet specific customer requirements. In the home textiles category, the company specializes in fabrics such as jersey, terry, micro terry, micro interlock, and brushed terry.

As a family-owned enterprise, the company’s entire shareholding is held by members of the Lodhia family. Mr. Shahid Lodhia holds a 32% ownership stake, while his wife, Mrs. Maimona Lodhia, owns 33.3% of the company. The remaining shares are distributed among members of their son Mr. Mohammad Lodhia’s family.

The ownership structure is expected to remain stable, with well-defined representation at the governance level. The company’s operations are primarily overseen by Mr. Shahid Lodhia, who serves as Chief Executive Officer. He has been associated with the company since its inception and brings extensive experience and diversified expertise to its leadership.

The sponsors bring decades of experience in the textile industry and comprise a team of qualified, seasoned professionals with a diverse range of skills and expertise. Their collective knowledge supports the company’s strategic direction and operational efficiency.

Rainbow Hosiery serves as the primary business interest of the Lodhia family, with no strategic stakes held in other companies. The sponsors maintain a strong financial profile and have demonstrated their commitment to the business through their willingness to provide support via director loans. This financial backing enhances the overall strength and stability of the company’s profile.

The company’s Board of Directors consists of three members: Mr. Shahid Lodhia, who serves as Chief Executive Officer, Mr. Mohammad Lodhia, the Managing Director. Mr. Mohammad Lodhia is the son of Mr. Shahid Lodhia, and Mr. Younoos Lodhia, who serves as the director of the company. Mr. Younoos is the son of Mr. Muhammad Lodhia, reflecting the company’s close-knit, family-owned governance structure.

Mr. Shahid Lodhia serves as the Chief Executive Officer and brings over 31 years of business experience to the company. The remaining members of the leadership team are professionally qualified, with extensive industry experience and a diverse set of skills that contribute to the company's strategic and operational effectiveness.

The Board met once during the fiscal year 2024, with full attendance from all board members and participation from relevant committee representatives. The meeting focused on discussing various strategic and operational matters concerning the company.

Clarkson Hyde Saud Ansari Chartered Accountants serve as the external auditors of the company. The firm holds a Quality Control Review (QCR) rating and issued an unqualified opinion on the company’s financial statements for the year ended June 2024, indicating that the financial statements present a true and fair view in accordance with applicable financial reporting standards.

The company has implemented a well-defined management structure, organized into functional departments, each with clearly delineated lines of responsibility. This structure ensures effective coordination and accountability across all areas of operation.

Mr. Syed Shamim Raza Zaidi serves as the Technical Director of the company and has been associated with the firm since its inception. With over three decades of industrial experience, he plays a key role in overseeing the company’s technical operations, supported by a qualified team of professionals. Mr. Adeel Qamar, the Chief Operating Officer (COO), brings versatile experience to the company, contributing to the financial management and strategy. All other team members are highly qualified professionals, working under the supervision of senior management to ensure smooth operations across all functions.

Rainbow Hosiery maintains a comprehensive IT infrastructure, ensuring adequate controls and reporting mechanisms that regularly update senior management on system performance and security. The company has established several committees to address various operational aspects, including, but not limited to, the Emergency Response Committee, Health & Safety Committee, Environment & Waste Management Committee, Work Council & Labor Committee, and Fire Drill & Fighting Committee. Each of these committees is led by an independent committee member, ensuring impartial oversight and effective management of critical matters.

Recently, the company implemented a newly developed local software, G-Tech. This software provides reliable and valuable insights that enhance the decision-making process, enabling the company to achieve its goals more effectively and efficiently.

The company utilizes licensed Microsoft Office tools, including Excel, Word, and Outlook, for its operations. Regular reports are provided to senior management, including vendor payable reports, PDC reports (cash flow and projections), aging reports (receivables), and job costing reports. The implementation of G-Tech software ensures timely access to information for effective decision-making. However, the absence of an internal audit function highlights an opportunity for improvement in the corporate management framework. The company holds several certifications, including the Organic Content Standard, Quality Registrar System, SANFOR KNIT, Sedex, Global Organic Standard, Made in Green, Step by OEKO-TEX, OEKO-TEX Inspiring Confidence, and is listed in the REX – Registered Exporter system GSP of the EU.

During 9MFY25, the textile industry maintained a steady growth trajectory across key segments. Knitwear led the exports, reaching US$ 3.7bln—an increase of ~16.82% YoY. This was supported by a ~9.20% rise in export volume to 195mln KGs and a ~6.98% increase in unit price to $19.32 per thousand KGs. Readymade Garments recorded a ~19.05% YoY growth in export value, amounting to ~$3.1bln. The performance was driven by a ~10.40% increase in unit price to ~$51.31 per thousand dozen, along with a ~7.84% rise in export volume to ~60mln dozen, indicating stable demand and incremental value gains within the segment. Bed Wear also showed positive momentum, with export volume reaching 391,331 MT, up ~12.20% YoY. Export value increased by ~13.70% to $2.3bln, supported by a modest 1.20% rise in unit price to $6.07 per MT—suggesting that volume growth remained the primary contributor.

Rainbow Hosiery maintains a strong presence in international markets, with exports primarily directed toward the United States, Canada, Netherlands, Germany, Poland, Denmark, and other European countries. The company has consistently been recognized for its excellence in manufacturing and exporting, receiving multiple industry awards and acknowledgments. Its growing reputation in key export destinations underpins its competitive position in the textile sector.

Rainbow Hosiery Private Limited is actively engaged in the export of home textiles and garments. The company has demonstrated steady growth in its topline performance. For the first half of FY25, Rainbow Hosiery recorded a revenue of PKR 5.9bln, compared to PKR 6.3bln in FY24. This performance reflects increased demand and enhanced production capacity.

In 6MFY25, the company posted a gross profit margin of 8.4%, an operating margin of 2.8%, and a net profit margin of 1.7%, reflecting margin compression despite strong topline growth. In FY24, the gross margin remained steady at 8.5%, while operating and net margins declined to 3.0% and 2.6%, respectively, due to higher administrative expenses and tax burden. In FY23, margins were comparatively stronger, with a gross profit margin of 8.5%, operating margin of 3.6%, and net profit margin of 3.5%.

Rainbow Hosiery's management has provided forecasts that reflect their strategy and demonstrate the feasibility of their approach. The company intends to continue investing in capital expenditure to improve manufacturing efficiency and enhance its e-commerce capabilities, in order to cater to the growing online market. A well-defined roadmap for five years business plan is placed.

In 6MFY25, the company’s net working capital days stood at 118 days, reflecting a further increase driven by higher inventory and receivables. In FY24, net working capital days were 105 days, up significantly from 41 days in FY23. The increase was primarily due to elevated inventory holding periods (FY24: 118 days; FY23: 92 days), which stemmed from rising demand, supply chain adjustments, and production cycles. Trade payable days also showed a rising trend, standing at 130 days in FY24 compared to 103 days in FY23, helping partially offset the working capital buildup.

The Company's free cashflows (FCFO) as of 6MFY25 stood at PKR ~168mln (FY24:233mln) owing to the overall increase in sales of the company. Meanwhile, the Company’s finance cost stood at PKR 35mln as of 6MFY25, (FY24:47mln). 

Rainbow Hosiery is a debt-free company. The company has more control over its finances, and business decisions and is considered self-reliant.