E-Vision Manufacturing Limited

CREDIT RATING REPORT | Jun-25

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Rating History
Dissemination Date Long-Term Rating Short-Term Rating Outlook Action Rating Watch
13-Jun-25 BBB A2 Stable Maintain -
14-Jun-24 BBB A2 Stable Maintain -
23-Jun-23 BBB A2 Positive Maintain -
24-Jun-22 BBB A2 Positive Maintain -
24-Jun-21 BBB A2 Stable Maintain -
About the Entity

E-Vision Manufacturing Limited is a public, unlisted entity incorporated in 2013. The Company is engaged in the manufacturing and regeneration of polyester staple fiber with a gross production capacity of 60 tons per day. The Company’s shareholding is structured through Marylebone Management Limited (MML), an offshore investment company incorporated in the British Virgin Islands. MML is wholly owned by IDL Investments, which holds a 60% stake in E-Vision. The remaining 40% stake is held by Mr. Abdul Ghaffar, the Company’s Chief Executive Officer. IDL Investments itself is wholly owned by Mr. Kashif Naseem Afzal.

Rating Rationale

The ratings reflect E-Vision Manufacturing Limited's ("the Company" or "E-Vision") adequate business profile and its established position in the recycled polyester staple fiber (r-PSF) industry. The Company has carved a niche in the textile sector by producing high-quality white, black, and green recycled polyester staple fiber and polyester chips from post-consumer polyethylene terephthalate (PET) bottles. Currently, the global market is experiencing a rapid shift from virgin to r-PSF and according to management, various global environmental authorities are advocating for the use of r-PSF over virgin PSF due to its lower energy consumption during manufacturing, minimal depletion of natural resources, and approximately ~20% lower cost compared to virgin polyester fiber. The local polyester industry continues to face significant challenges, primarily due to the availability of imported polyester, which is more cost-competitive than domestically produced alternatives, and a slowdown in offtake from the textile sector. In CY24, domestic production of Polyester Staple Fiber (PSF) declined by ~10%. This decrease was largely offset by a corresponding 10% increase in imports, with imported PSF now constituting around 43% of total local demand. During the 9MFY25 review period, the total quantity of textile and related commodity exports stood at ~1,392,395 MT, down from 1,455,242 MT in the same period last year (SPLY), reflecting a decline of ~4.31%. However, in value terms, exports increased by 9.38%, reaching ~USD 13,613 million, indicating improved unit prices or a shift toward higher-value textile products. In CY24, the Company reported revenue of ~PKR 1,438 million, reflecting a modest year-on-year decline of 4.5%. This decrease occurred despite a 14% increase in sales volumes, as the Company faced significant pricing pressure. Average selling prices declined by ~18% compared to the previous year. The unfavorable pricing environment offset volume-driven gains and resulted in slight margin compression across all levels. To combat this pricing challenge, the Company is strategically focused on improving the quality of its recycled polyester staple fiber (r-PSF) and has committed a sizeable CAPEX toward this initiative. This investment is expected to enhance both price realization and sales volumes in the domestic market, while also facilitating the expansion of the Company’s export footprint across the Asia-Pacific region. The financial risk profile of the Company is supported by adequate coverages, cashflows, and a stretched working capital cycle. Capital structure is leveraged, where borrowings are mainly comprised of short-term for working capital management.

Key Rating Drivers

The ratings hinge on sustainable revenue growth and margin improvement. Moreover, it is essential to maintain a robust capital structure consistent with the financial projections. Looking ahead, improvements to the Company's governance framework, control environment, and external audit function by engaging auditors which are included in SBP’s panel of auditors would be viewed positively.

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

E-Vision Manufacturing Limited

rating analysis

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Profile
Legal Structure

E-Vision Manufacturing Limited (E-Vision, “The Company”) is an unlisted, public limited concern incorporated in 2013. 


Background

E-Vision was incorporated in March 2013, as a private limited company and subsequently converted to public status in September 2015. The current production capacity of the company is ~60TPD.


Operations

The Company is involved in the manufacturing and recycling of polyester staple fiber (PSF) using the waste of polyethylene terephthalate (PET) bottles or other waste material. E-Vision's r-PSF is mainly used in the manufacturing of yarn for woven & knitted fabric for the home textile & other garments industry. The Company’s production facility is located in Sundar Industrial Estate, Lahore, and consists of two units: a washing unit and a production unit.


Ownership
Ownership Structure

The Company’s shareholding is held through an offshore investment company, Marylebone Management Limited (MML), incorporated in the British Virgin Islands. MML is now wholly owned by IDL Investments, which holds a 60% stake in E-Vision. The remaining 40% stake lies with Mr. Abdul Ghaffar (CEO). IDL Investments is 100% owned by Mr. Kashif Naseem Afzal, whose career has primarily focused on the natural resources sector, including base and precious metals mining. He has also built a diverse investment portfolio across power generation, energy transition, natural resources, and real estate. 


Stability

The Company does have a succession plan. In case of death of Mr. Salman Ganny, Marylebone Management Limited and E-Vision will be managed by other family members who have varied experience in business. Family includes his father Mr. Salim Ganny who is an investor and entrepreneur and his wife Mrs. Reema Ganny who has experience in corporate banking.


Business Acumen

Mr. Salman Ganny, who previously held 100% ownership of Marylebone Management Limited (MML), continues to serve as Chairman and Director of E-Vision. He brings a wealth of experience across the real estate, steel, engineering, and textile sectors.


Financial Strength

Mr. Salman Ganny's paternal family is Ganny Rangoonwala and his maternal family is Tabani. Both families are reputable business families based in Karachi for over six decades. Mr. Ganny and his family have the ability and willingness to support the business and for this purpose, various guarantees have been issued.


Governance
Board Structure

E-Vision’s Board of Directors comprises three members. The Board is Chaired by Mr. Ganny. Mr. Abdul Ghaffar (CEO) and Mr. Arif Siddiqui (company CFO), who represents MML, are also on the Board.


Members’ Profile

Mr. Salman Ganny, the Chairman of the company, is an accomplished investor and entrepreneur with a presence in both Pakistan and the UAE. He has previously held management roles in real estate and investment companies overseas.


Board Effectiveness

Board meetings are held quarterly with full attendance of directors. Meeting packs are shared with directors beforehand which comprise relevant financial data for discussion. Meanwhile, quality of discussion disclosed in meeting minutes has room for improvement. There are no Board committees in place to assist the Board.


Financial Transparency

Hassan Farooq & Company are the external auditors of the company. The auditors are only QCR-rated. They have expressed an unqualified opinion on the financial statements of the company for the year ended December 31, 2024. The board has also set up an internal audit function.


Management
Organizational Structure

E-Vision has a lean organizational structure divided into various functional departments, namely: i) Production, ii) Procurement, iii) Marketing, (iv)Human Resources and Administration, and v) Finance. The Manager Finance reports to the CFO – Mr. Arif Siddiqui – while all other departmental heads and managers are reporting to the CEO – Mr. Abdul Ghaffar


Management Team

Mr. Abdul Ghaffar – company CEO – is a Chartered Accountant with over twenty years of experience in various manufacturing concerns including glass, textile and industrial gases companies as well as experience in financial services sector. He is actively involved in day-to-day operations and decision making in the Company. The management team, though small in size, constitutes well-experienced, seasoned individuals.


Effectiveness

The Company has formed four management committees to assist decision making. While the Audit Committee and Human Resource Committee convene on need basis, the Management Committee and Procurement Committee meet monthly. Meetings minutes are properly documented. All departmental leads meet with the CEO daily to discuss day-to-day developments and issues.


MIS

E-Vision implemented BMA Complete Solutions V 1.2 in 2014 as an ERP solution to streamline the flow of information from all departments. The software provided by M/S Soft Consult comprises modules for inventory management, financial accounting, HR management, sales support, and fixed assets management while the production management module is being developed.


Control Environment

Daily reports regarding the Company’s receivables and payables position, purchases and procurement, and bank position are prepared and submitted to higher management. The Company also has a lab on its premises for quality testing of fibers to ensure quality control. Furthermore, an international certification has been acquired by the Company: Global Recycled Standard. The company is also ISO 9001 certified.


Business Risk
Industry Dynamics

Recycled polyester staple fiber (rPSF) is a prominent segment in recycling PET and is projected to be the fiber of the future in the entire textile industry. There was a notable decrease in the demand for both cotton and PSF during FY24, with a decline of ~10.8% for PSF and a general downturn in textile activity driven by high energy and financing costs. During FY24, average prices for crude oil and MEG were down by approximately ~2.8% and ~3.9% YoY, respectively. The annual turnover of the rPSF segment stood at approximately PKR~1,461 million (FY23: PKR~1,506 million), despite an ~11.6% increase in rPSF prices, owing to competition from imported PSF which remained ~25% cheaper. The segment’s total installed capacity as of June 2024 was ~82,125 MTPA, dominated by four major players: E-Vision, Pinnacle Fibre, Lasani, and Khalis Fibre.


Relative Position

The r-PSF industry in Pakistan constitutes a few players, of which one of the leading players is E-Vision. Its main competitors are Khalis fiber, Lasani fiber, Pinnacle fiber, Gulf fiber, Ravi fiber, Sun Fiber, and ICI Pakistan. E-Vision remains the only player in the local industry with an import license.


Revenues

The Company’s topline clocked in at ~PKR1,438mln in CY24, down from ~PKR1,506mln in CY23 and ~PKR2,086mln in CY22, reflecting a ~4.5% YoY contraction in CY24 following a ~27.8% decline in CY23. Local sales continue to dominate the revenue mix (~95%), mainly comprising white r-PSF, with minor contributions from black and green r-PSF. Export sales remain limited, primarily in the form of r-PSF chips.


Margins

Gross margins slightly dipped to ~18.8% in CY24 from ~19.7% in CY23 but remained above ~18.9% in CY22. Operating margins also moderated to ~13.5% in CY24 from ~15.4% in CY23, though still higher than ~9.2% in CY22. Net profit margin narrowed to ~2.6% in CY24 from ~3.4% in CY23 and ~3.1% in CY22, indicating continued margin pressure despite relatively stable operations.


Sustainability

The company's primary export countries are China and Turkey but during the period exports of the company heavily declined due to low polyester price rates. Additionally, the company's management is considering the installation of a solar power system with a capacity of ~50 kilo watt within the next few months to reduce the power and energy costs to ~25% approx.


Financial Risk
Working capital

The net cash cycle extended further to ~196 days in CY24 from ~154 days in CY23 and ~118 days in CY22. This was driven by a rise in inventory days to ~226 in CY24 from ~155 and ~104 in preceding years. Trade payables remained elevated at ~79 days in CY24 versus ~47 days in CY23 and ~11 days in CY22, leading to gross working capital days rising to ~275 in CY24 from ~201 and ~128.


Coverages

E-Vision’s FCFO declined to ~PKR221mln in CY24 from ~PKR247mln in CY23, after growing from ~PKR196mln in CY22. Finance cost stood at ~PKR131mln in CY24, slightly down from ~PKR137mln in CY23 but significantly higher than ~PKR88mln in CY22. Interest coverage further dropped to ~1.7x in CY24 from ~1.9x in CY23 and ~2.4x in CY22, indicating increasing stress on debt-servicing capacity.


Capitalization

The capital structure remained leveraged with a gearing ratio of ~46.9% in CY24, marginally lower than ~47.0% in CY23 and ~48.9% in CY22. Borrowings continued to be entirely short-term, amounting to ~PKR571mln in CY24, up from ~PKR530mln in CY23 and slightly above ~PKR538mln in CY22.
 
 

Jun-25

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E-Vision Manufacturing Limited

financial summary

(PKR mln)

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Dec-24
12M		 Dec-23
12M		 Dec-22
12M
A. BALANCE SHEET
1. Non-Current Assets 408 449 437
2. Investments 0 0 0
3. Related Party Exposure 0 0 0
4. Current Assets 1,521 1,343 907
a. Inventories 1,062 721 560
b. Trade Receivables 99 286 92
5. Total Assets 1,929 1,792 1,344
6. Current Liabilities 580 515 152
a. Trade Payables 285 341 50
7. Borrowings 598 567 563
8. Related Party Exposure 0 0 0
9. Non-Current Liabilities 74 72 41
10. Net Assets 678 638 588
11. Shareholders' Equity 678 638 588
B. INCOME STATEMENT
1. Sales 1,438 1,506 2,086
a. Cost of Good Sold (1,168) (1,209) (1,692)
2. Gross Profit 270 297 394
a. Operating Expenses (77) (66) (201)
3. Operating Profit 194 232 193
a. Non Operating Income or (Expense) 1 2 (16)
4. Profit or (Loss) before Interest and Tax 195 234 176
a. Total Finance Cost (131) (137) (88)
b. Taxation (26) (45) (24)
6. Net Income Or (Loss) 38 52 65
C. CASH FLOW STATEMENT
a. Free Cash Flows from Operations (FCFO) 221 247 196
b. Net Cash from Operating Activities before Working Capital Changes 81 116 119
c. Changes in Working Capital (113) (72) (111)
1. Net Cash provided by Operating Activities (31) 44 8
2. Net Cash (Used in) or Available From Investing Activities 1 (31) (79)
3. Net Cash (Used in) or Available From Financing Activities 31 (15) 65
4. Net Cash generated or (Used) during the period 1 (3) (6)
D. RATIO ANALYSIS
1. Performance
a. Sales Growth (for the period) -4.5% -27.8% 37.7%
b. Gross Profit Margin 18.8% 19.7% 18.9%
c. Net Profit Margin 2.6% 3.4% 3.1%
d. Cash Conversion Efficiency (FCFO adjusted for Working Capital/Sales) 7.6% 11.6% 4.1%
e. Return on Equity [ Net Profit Margin * Asset Turnover * (Total Assets/Shareholders' Equity )] 5.7% 8.5% 11.6%
2. Working Capital Management
a. Gross Working Capital (Average Days) 275 201 128
b. Net Working Capital (Average Days) 196 154 118
c. Current Ratio (Current Assets / Current Liabilities) 2.6 2.6 6.0
3. Coverages
a. EBITDA / Finance Cost 2.0 2.2 3.0
b. FCFO / Finance Cost+CMLTB+Excess STB 1.6 1.7 2.2
c. Debt Payback (Total Borrowings+Excess STB) / (FCFO-Finance Cost) 0.3 0.3 0.2
4. Capital Structure
a. Total Borrowings / (Total Borrowings+Shareholders' Equity) 46.9% 47.0% 48.9%
b. Interest or Markup Payable (Days) 44.4 66.7 85.2
c. Entity Average Borrowing Rate 22.3% 23.0% 15.5%

Jun-25

www.pacra.com

E-Vision Manufacturing Limited

rating scale

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Jun-25

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E-Vision Manufacturing 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.
  2. Restrictions
    1. No director, officer, or employee of PACRA communicates the information acquired by him for use for rating purposes to any other person, except where required under law to do so. (Chapter III; 10-(5))
    2. PACRA does not disclose or discuss with outside parties or make improper use of the non-public information which has come to its knowledge during a business relationship with the customer. (Chapter III; 10-7-(d))
    3. PACRA does not make proposals or recommendations regarding the activities of rated entities that could impact a credit rating of the entity subject to rating. (Chapter III; 10-7-(k))
  3. Conduct of Business
    1. PACRA fulfills its obligations in a fair, efficient, transparent, and ethical manner and renders high standards of services in performing its functions and obligations. (Chapter III; 11-A-(a))
    2. PACRA uses due care in the preparation of this Rating Report. Our information has been obtained from sources we consider to be reliable, but its accuracy or completeness is not guaranteed. PACRA does not, in every instance, independently verify or validate information received in the rating process or in preparing this Rating Report. (Clause 11-(A)(p))
    3. PACRA prohibits its employees and analysts from soliciting money, gifts, or favors from anyone with whom PACRA conducts business. (Chapter III; 11-A-(q))
    4. PACRA ensures before the commencement of the rating process that an analyst or employee has not had a recent employment or other significant business or personal relationship with the rated entity that may cause or may be perceived as causing a conflict of interest. (Chapter III; 11-A-(r))
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    6. PACRA promptly investigates in the event of misconduct or a breach of the policies, procedures, and controls, and takes appropriate steps to rectify any weaknesses to prevent any recurrence, along with suitable punitive action against the responsible employee(s). (Chapter III; 11-B-(m))
  4. Independence & Conflict of Interest
    1. PACRA receives compensation from the entity being rated or any third party for the rating services it offers. The receipt of this compensation has no influence on PACRA’s opinions or other analytical processes. In all instances, PACRA is committed to preserving the objectivity, integrity, and independence of its ratings. Our relationship is governed by two distinct mandates: i) rating mandate - signed with the entity being rated or issuer of the debt instrument, and ii) fee mandate - signed with the payer, which can be different from the entity.
    2. PACRA does not provide consultancy/advisory services or other services to any of its customers or their associated companies and associated undertakings that are being rated or have been rated by it during the preceding three years, unless it has an adequate mechanism in place ensuring that the provision of such services does not lead to a conflict of interest situation with its rating activities. (Chapter III; 12-2-(d))
    3. PACRA discloses that no shareholder directly or indirectly holding 10% or more of the share capital of PACRA also holds directly or indirectly 10% or more of the share capital of the entity which is subject to rating or the entity which issued the instrument subject to rating by PACRA. (Chapter III; 12-2-(f))
    4. PACRA ensures that the rating assigned to an entity or instrument is not affected by the existence of a business relationship between PACRA and the entity or any other party, or the non-existence of such a relationship. (Chapter III; 12-2-(i))
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    3. PACRA initiates an immediate review of the outstanding rating upon becoming aware of any information that may reasonably be expected to result in downgrading of the rating. (Chapter III; 17-(c))
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  6. Probability of Default
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Jun-25

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