The Company was incorporated in 1983 as a public limited Company under the name "Alhamd Textile Mills Limited" or the "ACL". It was listed on the Karachi Stock Exchange and Lahore Stock Exchange in 1988. Afterward, it was voluntarily delisted from the stock exchanges in 2004 and subsequently converted into a private limited Company in 2005.

The Company was once part of a group of companies led by Sheikh Imdad Ahmed (late). He was the driving force behind the establishment of the Company and served in the capacity of the Chairman. After the death of Sheikh Imdad Ahmed, the Company went through an amicable business settlement between his four sons. As a consequence of this settlement, 99.64% of the Company’s paid-up shares were transferred to Sheikh Afzaal Ahmed and his immediate family in 1998.

The principal activity of ACL is the manufacturing and sale of cotton/blended yarn. Its operational infrastructure includes two state-of-the-art spinning facilities with a cumulative annual production capacity of ~170,472 spindles (Unit I with 126,696 spindles & Unit II with 43,776 spindles). The Company's registered head office is located at 29-A, Block E1, Gulberg III, Lahore, while the manufacturing facility is situated at Dera Ghazi Khan, which is considered a major cotton cultivation area in Pakistan. The Company fulfills its energy requirements through connections with Gas and WAPDA. To optimize production costs, the management will invest in an 8.5-megawatt solar power project, which will be commissioned by the end of March 2026.

Alhamd Corporation (Pvt.) Limited is a family-owned business. Mr. Sheikh Afzaal Ahmed holds a 74% stake, while his son, Mr. Asad Imdad Sheikh, owns a 25% stake.

The Company's ownership is predominantly concentrated within the Sheikh family, with the majority of shares held by key family members. A small portion of the Company’s shares is distributed among a few other individuals, some of whom are also family members. This clear distribution of shareholding, with the Sheikh family maintaining control, indicates a well-defined and structured line of succession, ensuring continuity and stability in leadership for the Company’s future.

The Sheikh family has a rich history in the textile industry, spanning over three decades, which has equipped them with a wealth of technical expertise and industry insight. Sheikh Afzaal Ahmed, the key figure behind the Company's operations, possesses a deep understanding and sharp acumen in textile spinning, a core area of the business. His extensive experience in the field has played a critical role in ensuring the Company’s operations remain efficient and sustainable. This foundation not only drives the Company’s day-to-day activities but also positions it for long-term success in the competitive landscape.

The financial strength of the sponsor family is considered adequate. The Company being the only operational Company of the shareholders reflects the sponsor's willingness to support if needed.

The Board comprises three members, including two representatives from the sponsoring family—Mr. Sheikh Afzaal Ahmed and Mr. Asad Imdad Sheikh—while the remaining member serves as an executive director. Mr. Sheikh Afzaal Ahmed holds the dual role of Chief Executive Officer and Chairman of the Board. The sponsor-dominated composition and relatively small size of the Board indicate potential room for strengthening the Company’s governance framework through broader representation and enhanced independent oversight.

Sheikh Afzaal Ahmed, a seasoned businessman, oversees and manages the all operational aspects of the Company. With over 43 years of experience in the industry, he brings invaluable expertise in strategic decision-making. His knowledge of the textile industry has been integral in shaping the Company's direction and maintaining its competitive edge. Mr. Asad Imdad Sheikh, the son of Sheikh Afzaal Ahmed, is a graduate of Duke University in Durham, North Carolina, USA, where he earned a degree in Marketing and Business Management, with a focus on Social Sciences. With a strong academic background, he has been an essential part of the Company for the past 11 years, contributing to a forward-thinking direction.

The Company does not have a board committee in place, which affects the overall effectiveness of the board. During FY25, four BOD meetings were conducted to discuss the Company's performance, and the attendance of the Board of Directors (BOD) remained strong. The meeting minutes have been formally documented. However, the establishment of a board committee will further enhance the effectiveness of the board

M/s Shinewing Hameed Chaudhari and Co., Chartered Accountants are the external auditors of the Company. The Company’s auditors are rated in the "B Category" by the SBP panel of auditors. The auditors have expressed an unqualified opinion on the financial reports for the year ended June 2025.

The Company’s organizational structure is designed with distinct functional departments, each led by highly skilled professionals with extensive experience in the textile industry. These department heads bring a wealth of knowledge and expertise, ensuring that each function, whether it be production, marketing, finance, or operations runs efficiently and effectively.

Sheikh Afzaal Ahmad is the Chief Executive Officer (CEO) of ACL while his son, Mr. Asad Imdad Sheikh, is serving as the Chief Operating Officer (COO). The other two executive directors lead the technical and commercial department. Mr. Mudassar Zubair, the Chief Financial Officer (CFO) has been associated with the Company for over ten years.

The management meetings are held quarterly to resolve or proactively address any operational issues of the Company.

To enhance reporting and streamline operations, the Company implemented a fully functional ERP (Enterprise Resource Planning) software in 2021. This system has significantly improved overall efficiency by integrating key business processes across departments, from inventory management to financial reporting. In the coming years, the management intends to install updated dashboards with real-time data access and automated workflows which is expected to facilitate better decision-making, reduce manual errors, and improve communication across the organization.

The Company has maintained a sound quality management system since its inception, with a strong focus on producing premium-quality yarn. To ensure the highest standards, the Company imports raw cotton from reputable sources such as USA and Brazil, among others. Additionally, the Company has an in-house internal audit department for control over its processes and quality standards.

Textile exports of the country reached USD ~681.0mln in FY25 (cotton yarn only), down from USD ~956.0mln in FY24, reflecting a ~28.8% YoY decline in value. In volume terms, yarn exports declined to ~256,000 MT in FY25 from ~353,000 MT in FY24 (~27.5% YoY decrease). China remained the largest export destination, accounting for ~61.9% of total yarn exports in FY25. During FY25, yarn exports contributed ~2.1% to the country’s total exports (FY24: ~3.1%). In FY25, the transition from the final tax regime to the normal tax regime continued to impact export-oriented units, with corporate profits subject to 29% tax along with a super tax of up to 10%, thereby affecting the profitability matrix of the textile value chain.

Alhamd Corporation (Pvt.) Limited is a mid-sized spinning unit and one of textile ventures of the Sheikh family. The total spindles installed in Pakistan's spinning industry are 13.4 mln out of which the Company has 170,472 spindles installed i.e., 1.3%.

The Company’s revenue base remains predominantly concentrated in local sales. During FY25, the topline declined to ~PKR 18.5bln from ~PKR 20.9bln in FY24, reflecting a contraction of ~11.4% YoY amid demand rationalization and pricing adjustments. Local sales constituted ~100% of total revenue in FY25 (FY24: ~99.6%), while export sales remained negligible. The Company continues to benefit from a stable customer base in the local market, maintaining long-standing relationships with established textile players, thereby keeping client concentration risk at manageable levels. During 3MFY26, sales were reported at ~PKR 3.1bln, depicting a decline of ~33.4% compared to the corresponding period last year (~PKR 4.6bln in 3MFY25), reflecting subdued volumetric offtake and pricing pressures.

During FY25, the gross profit margin compressed to ~3.8% (FY24: ~6.7%) due to elevated input costs and pricing constraints. Consequently, PBIT declined sharply to ~PKR 132mln (FY24: ~PKR 822mln). Operating expenses remained largely controlled at ~PKR 713mln (FY24: ~PKR 776mln); however, the impact of lower gross profitability diluted operating performance. Finance costs remained elevated at ~PKR 1.5bln (FY24: ~PKR 1.6bln), keeping pressure on the bottom line. Resultantly, the Company reported a net loss of ~PKR 1.2bln in FY25 compared to a net loss of ~PKR 774mln in FY24. Net profit margin deteriorated to ~-6.4% (FY24: ~-3.7%). During 3MFY26, the Company reported a negative gross margin of ~-1.5% and a net loss of ~PKR217mln, translating into a net margin of ~-7.1%, reflecting continued stress on profitability.

The Company’s new spinning unit (Unit II) is operational with an adequate capacity utilization level. Further, the management plans to install an 8 Mega Watt solar which is expected to become operational by the end of Feb'26.

The Company’s working capital cycle remains a function of inventory and receivable days, with reliance on short-term borrowings. During FY25, the net working capital cycle extended to ~85days compared to ~71 days in FY24, primarily due to higher inventory days (~59 days in FY25 vs ~55 days in FY24) and increased receivable days (~41 days in FY25 vs ~28 days in FY24). In 3MFY26, the net working capital cycle further elongated to ~125 days (FY25: ~85 days), driven by a buildup in inventory (~84 days) and receivables (~62 days), reflecting slower conversion into cash. Short-term trade leverage remained constrained at ~-4.7% in 3MFY26 (FY25: ~-20.5%), highlighting continued dependence on borrowings.

During FY25, FCFO declined to ~PKR 805mln from ~PKR 1.4bln in FY24 (~42.7%YoY decline), owing to weaker profitability. Interest coverage (EBITDA/Finance Cost) weakened to ~0.8x (FY24: ~1.1x), while FCFO/Finance Cost stood at ~0.5x (FY24: ~0.9x), indicating stressed debt-servicing capacity. In 3MFY26, coverages remained subdued with EBITDA/Finance Cost at ~1.1x and FCFO/Finance Cost at ~0.8x. Sustained improvement in operating cash flows remains critical for rating stability.

The Company’s debt profile comprises a mix of short-term and long-term borrowings, including conventional facilities and SBP-related schemes. During FY25, total borrowings increased to ~PKR 8.9bln from ~PKR 7.9bln in FY24. Consequently, total leverage rose to ~64.7% (FY24: ~56.7%). Shareholders’ equity declined to ~PKR 5.1bln (FY24: ~PKR 6.3bln) due to accumulated losses. In 3MFY26, total borrowings stood at ~PKR 8.1bln; however, leverage further escalated to ~65.5% owing to erosion in equity (~PKR 4.9bln). The capital structure remains leveraged, with reliance on short-term funding to finance working capital requirements.