Ideas (Private) Limited (hereafter referred to as “IDEAS” or “the Company”) was incorporated in Pakistan on December 27, 2004, as a private limited company. The Company’s registered office is situated at Plot No. 65/1, Sector 30, Korangi Industrial Area, Karachi. IDEAS is the dedicated retail arm of the Gul Ahmed Group and is engaged in the manufacturing and sale of textile goods and other products, mainly through retail and online channels, under the ‘Ideas by Gul Ahmed’ brand. The product portfolio comprises fabric, apparel, home textiles, footwear, accessories, fragrances and cosmetics, and the Company also operates a café at Dolmen Mall, Clifton, Karachi. The Company operates 89 stores nationwide and 3 Wholesale Business Centres (WBC), making 92 outlets overall, supported by warehouses in Karachi, Lahore and Islamabad and a production facility in Korangi Industrial Area, Karachi. The Company had 1,541 employees as of June 30, 2026 (FY25: 1,588).

The Company is a wholly owned subsidiary of Gul Ahmed Textile Mills Limited (GATM), the Group’s flagship vertically integrated textile manufacturer, which holds 100% of the paid-up capital of PKR 4,599mln (including one nominee share held by the CEO). GATM is in turn a subsidiary of Gul Ahmed Holdings (Private) Limited, the ultimate parent. The shares were issued to GATM under a scheme of arrangement sanctioned by the High Court of Sindh in October 2021, together with bonus shares. The ownership structure is stable and no change is expected in the foreseeable future. The sponsors hold interests across textiles, power, renewable energy and investment businesses, which provides diversification and financial flexibility to the Group. The relationship with the parent is also commercial: purchases from GATM amounted to PKR 1,628mln during FY26 (FY25: PKR 1,782mln), and PKR 588mln of trade payables due to GATM carry a markup of 6M KIBOR + 0.75% as reimbursement of GATM’s finance cost (FY25: PKR 1,022mln). The reimbursement of finance cost declined to PKR 30mln in FY26 (FY25: PKR 521mln).

The Board of IDEAS comprises three members: Mr. Mohomed Bashir (CEO), Mr. Mohammad Zaki Bashir (Director) and Mr. Salim Ghaffar (Company Secretary). The Board is led by the sponsor family and decision-making remains concentrated among the principal shareholders of the Group. Mr. Mohomed Bashir has 45 years of business experience and joined the Board in December 2021, while Mr. Mohammad Zaki Bashir has 21 years of experience across the Group’s textile, power and investment interests. The Company does not maintain formal board committees, and strategic decisions are taken in consultation with GATM. The induction of independent directors and the establishment of formal board committees would strengthen the governance framework. The external auditors, M/s Kreston Hyder Bhimji & Co. Chartered Accountants, are placed in Category ‘A’ on the SBP’s panel of auditors. They issued an unqualified opinion on the Company’s financial statements for the year ended June 30, 2026.

The Company’s operational structure comprises specialized divisions led by qualified professionals, with the heads of finance, audit, human resources, and IT reporting to the CEO or CFO. Mr. Mohomed Bashir brings 45 years of business experience to his role as Chief Executive Officer, having formally joined the Board in December 2021. Mr. Kamran Hussain, the CFO, has 17 years of financial experience and is supported by senior managers across finance, audit, human resources, and IT. The Company also benefits from its affiliation with GATM through shared services and group-level oversight in procurement, supply chain, and human resources. Microsoft Dynamics 365 serves as the core ERP system, integrated with Power BI for management reporting and dashboards, with the overall MIS considered adequate for the scale of operations. The Company maintains an in-house internal audit function; however, further strengthening of internal audit and management committee frameworks would support effective oversight as the business expands.

The Pakistani fashion retail sector operates in the downstream, value-added segment of the textile value chain, which remains a key component of the economy, accounting for ~18.2% of the Quantum Index of Manufacturing (QIM) in FY26, while wholesale, retail and trade contribute ~30.5% of the services sector. The industry continues to face raw material and supply-side challenges, with domestic cotton production constrained by water shortages, pest attacks and tax-related distortions. While cotton production is estimated to improve to ~5.3mln MT in the Aug-26 marketing year from ~5.0mln MT previously, domestic supply remains supplemented by significant imports, projected at ~4.5mln MT. Local cotton prices averaged ~PKR 15,464/maund during 1HFY26, reflecting softer international prices. Meanwhile, textile exports recorded modest growth of ~1.4% YoY to ~USD 15.0bln during 10MFY26, supported by higher-value segments, including readymade garments. However, elevated energy tariffs, factory operating costs and broader cost pressures continue to constrain industry margins. Within this environment, demand for branded apparel remains sensitive to consumer purchasing power, inflation and pricing, while competition among organized retailers and unorganized players remains intense. IDEAS maintains a strong position in the organized retail segment, competing with established brands, including Sapphire, Khaadi, Outfitters, J. and Bareeze. Its access to the parent company's manufacturing capabilities and supply chain provides greater control over product quality, lead times and margins. During FY26, net sales grew an exponential 15.9% to PKR 30,957mln (FY25: PKR 26,711mln). The revenue base remains overwhelmingly domestic, with exports, primarily to the UAE, the US, the UK and Saudi Arabia, contributing around 1.2%. Gross margin moderated to 40.0% (FY25: 42.5%) as cost of sales grew faster than revenue. Operating expenses increased 12.3% to PKR 9,858mln, primarily driven by distribution costs of PKR 8,311mln, equivalent to 26.8% of sales, with salaries, advertising and depreciation, largely relating to right-of-use assets for rented outlets, constituting the major components. Net margin, improved to 1.9% (FY25: 0.8%), supported by lower finance costs, which declined to 4.6% of sales (FY25: 6.1%) following a reduction in markup reimbursed to the parent, and a lower effective tax rate of 43.4% (FY25: 66.9%). The tax charge remained elevated due to super tax of PKR 131mln. Profit for the year also included a non-cash gain of PKR 188mln arising from the derecognition of leases. 

The financial risk profile of IDEAS improved during FY26, supported by stronger cash generation and lower finance costs. EBITDA increased to PKR 4,259mln from PKR 4,063mln in FY25, with EBITDA to finance cost coverage improving to 3.0x from 2.5x and FCFO to finance cost coverage rising to 2.7x from 2.3x. However, coverage of total debt servicing, including finance costs, current maturities of long-term borrowings and excess short-term borrowings, remained at 0.9x. Debt servicing requirements include PKR 2,250mln of long-term financing and PKR 827mln of current lease liabilities falling due in FY27. Working capital requirements remain significant due to substantial inventory holdings of fabric and finished goods. Inventory declined by 7.1% to PKR 10,122mln in FY26 from PKR 10,899mln in FY25, with finished goods decreasing by 11.2%. Inventory days improved to 125 from 129, while trade receivable days remained at 4, reflecting the Company's cash-based retail model. Trade payable days declined to 46 from 82. Consequently, net working capital days increased to 83 from 51, while the current ratio improved slightly to 2.5x from 2.4x. Operating cash flows turned positive at PKR 3,262mln, compared with negative operating cash flows in FY25. Total borrowings declined by 15.3% to PKR 6,251mln at Jun-26 from PKR 7,379mln at Jun-25. These comprised PKR 2,250mln of long-term Diminishing Musharaka financing from Bank Alfalah Islamic and Meezan Bank, PKR 827mln of current lease liabilities and PKR 3,174mln of short-term borrowings. The Company repaid PKR 750mln of long-term financing during FY26, leaving PKR 2,250mln due within FY27. The Company's capital structure strengthened, with gearing declining to 51.5% at Jun-26 from 58.2% at Jun-25. Equity increased to PKR 5,876mln from PKR 5,299mln, supported by retained earnings, while no dividend was paid during the year. Short-term borrowings accounted for 50.8% of total borrowings. The Company had access to short-term financing limits of PKR 10,675mln, of which 29.7% was utilized. During 3MFY27, the Company recorded net sales of PKR 7,224mln, with gross, operating and net margins of 42.6%, 6.5% and 1.1%, respectively. The strong gross margin was partly offset by operating expenses, which accounted for 36.1% of sales. EBITDA stood at PKR 923mln and FCFO at PKR 846mln, translating into EBITDA to finance cost coverage of 2.7x and FCFO to finance cost coverage of 2.5x. Borrowings declined further to PKR 5,511mln following the repayment of another PKR 750mln of long-term financing, while gearing improved to 48.0%. However, inventory increased by 17.7% to PKR 11,913mln during the quarter, largely financed through higher trade payables, which rose to PKR 6,593mln, equivalent to 65 days. The current ratio moderated, although liquidity remained adequate. Going forward, effective inventory management and timely servicing of the PKR 2,061mln current maturity of borrowings will remain important.

Ideas (Private) Limited is set to issue its first Rated, Unlisted, Unsecured, Privately Placed, Short-Term Sukuk (STS 1) of up to PKR 1.0 billion, with a tenor of up to six (06) months from the date of drawdown. The Sukuk will carry a markup of 3M KIBOR + 75 bps, with the base rate set one business day prior to the Musharaka Commencement Date and reset quarterly. The markup will be paid at maturity and the principal will be redeemed as a bullet at the expiry of the tenor. The Sukuk will be issued in scripless form at a face value of PKR 1,000,000 each or multiples thereof and will be CDC eligible. The Issuer has the option to redeem the Sukuk, in full or in part, at any time on or after three (03) months from the Issue Date, with at least 15 days’ prior written notice. The purpose of the instrument is to finance the Company’s working capital requirements. Habib Bank Limited acts as the Exclusive Mandated Lead Advisor and Arranger and as the Issue/Investment Agent, and Alhamd Shariah Advisory Services (Pvt) Limited is the Shariah Advisor. The issue will be governed by the applicable regulations and guidelines of the Securities and Exchange Commission of Pakistan.

The instrument is unsecured.

Repayment is dependent on the Company’s internally generated cash flows, supported by FCFO of PKR 3,844mln in FY26 and PKR 846mln in 3MFY27, as well as access to unutilized short-term credit lines. The assessment also considers the Company’s strategic importance to GATM and the Group. Utilization of the PKR 10,675mln short-term borrowing limits stood at 29.7%, providing adequate headroom, while liquid cover remained strong.