Mughal Iron & Steel Industries Limited (“MISIL” or “the Company”) was incorporated in Pakistan as a public limited company in 2010 and was listed on the Pakistan Stock Exchange in March 2015, under the Engineering sector. The Company’s registered office is located in Lahore, while its manufacturing facility is situated at 17 KM Sheikhupura Road, Kot Abdul Malik.

MISIL traces its roots to “Mughal Steel”, a partnership concern established over six decades ago and managed by the Company’s major sponsors. In 2010, the business was restructured and incorporated as a public limited company to achieve better governance, transparency, and growth prospects. The Company was subsequently listed on the PSX in March 2015 under the Engineering sector. Over the years, MISIL has evolved into a fully integrated manufacturer in the ferrous segment, producing a wide range of steel products, while also diversifying into non-ferrous offerings such as copper and aluminum. The Company primarily caters to the domestic housing sector (urban and rural), and the large infrastructure projects.

MISIL's operations are comprised of two segments: ferrous and non-ferrous. The ferrous segment is the principal line of business and contributes the majority of revenues. Over time, the Company has developed a broad product portfolio within this segment, including billets, girders, T-Iron, rebars, and other steel products, enabling it to serve the diverse needs of the housing, industrial, and infrastructure sectors. The non-ferrous segment, though relatively smaller in scale, primarily comprises copper and aluminum ingots and has historically supported profitability through export proceeds, particularly from sales to China. However, operations of this segment are currently suspended on a temporary basis, leaving the ferrous segment as the sole operating segment.

The Sponsor family holds a controlling stake (around ~75.3%) with the remaining ownership distributed among financial institutions and the general public. As of June 30, 2026, the Company’s ordinary shareholding was concentrated with Directors/CEO & family (43.20%) and Associated Companies/related parties (32.16%), while Banks/DFIs/NBFIs held 5.16% and the General Public 7.91%. On June 17, 2025, the Company further issued 33,062,447 Ordinary Class-C shares through a rights issue.

The ownership structure of MISIL is regarded as stable, with majority shareholding vested in the Mughal family. As the founding sponsors have a longstanding association with the steel business and their sustained commitment significantly reduces the likelihood of any ownership changes in the foreseeable future.

With over six decades in the business, the sponsoring Mughal family demonstrates extensive experience in the steel and allied industries. Their longstanding presence reflects both resilience and strong market knowledge, positioning them as one of the key players in the sector.

The financial health of the Company is considered adequate, underpinned by sponsor support. The owners not only provide strategic direction in line with the evolving business environment but have also demonstrated their commitment by injecting funds on an as-and-when-required basis.

Board Structure The Board comprises seven members, including two executive directors, two independent directors, and three non-executive directors. The executive and non-executive directors represent the sponsoring family, including the Chairman, Mr. Mirza Javed Iqbal, and the CEO. The Board also includes a female nominee director.

The Board possesses the requisite skills, knowledge, and experience to provide effective oversight. The Chairman, Mr. Javed Iqbal, brings over four decades of experience in the local steel industry. The Board’s composition reflects the sponsoring family’s significant presence and continuity in leadership, while the inclusion of independent directors, Mr. Shoaib Ahmed Khan and Mr. Muhammad Aslam Bhatti, adds an independent perspective to the Company’s governance framework. Overall, the Board combines extensive industry experience with a longstanding association with the Company.

The Company’s governance framework is supported by an active Board and a committee structure that facilitates oversight of key functions, including financial reporting, human resource management, remuneration, and sustainability. During FY26, the Board held six meetings, with satisfactory attendance and leave duly recorded for absences, reflecting regular engagement in strategic and oversight matters. The Company has three Board committees: the Audit Committee, HR & Remuneration Committee, and Environment, Social and Governance (ESG) Committee, each including an independent director in accordance with applicable SECP requirements. During the year, the Audit Committee held five meetings, the HR & Remuneration Committee held two meetings, and the ESG Committee convened once. Following the election of directors, the committees were reconstituted, with changes in membership and chairmanship to align with the revised Board composition.

The Company’s external auditors, are ,M/s. Fazal Mahmood & Co. and M/s. Muniff Ziauddin & Co., expressed an unqualified opinion on the financial statements for the year ended June 30, 2026.

The Company follows a streamlined organizational structure with clear roles and significant delegation. The organogram is divided between the CFO and COO, with departments reporting accordingly, while executive directors and the CEO report to the Board. This structure supports effective decision-making and operational efficiency.

Mr. Khurram Javed, the CEO, has over a decade of professional experience and holds an MBA from Coventry University. He has enhanced the Company’s HR quality by inducting professionals across diverse fields and also serves as CEO of four group companies: Mughal Energy Limited, Mughal Steel Re-Rolling Industries Limited, Mughal International IMPEX Limited, and Indus Engineering (Pvt.) Limited. He is supported by a skilled and experienced management team. The team also includes Mr. Shakeel Ahmad, Chief Operating Officer, who brings over a decade of experience in strategic market positioning, sales growth, and brand development. Supporting him is Mr. Muhammad Zafar Iqbal, Chief Financial Officer, a Fellow Member of ICAP with extensive expertise in finance, taxation, and strategic planning.

MISIL does not have formal management committees; instead, departmental heads hold regular meetings to review key performance areas and report to their respective executive directors.

MIS reports are prepared and customized as per management’s requirements on a daily, weekly, and monthly basis, covering areas such as re-ordering sheets and financial facilities status.

The Company has an Enterprise Resource Planning (ERP) system in place, which is currently being used for reporting purposes. The system facilitates the integration of key business functions and supports the timely generation of financial and operational information for management. This enhances data accuracy, strengthens internal controls, and improves the reliability of management reporting and decision-making.

During FY26, Pakistan's long steel (rebar) sector continued to operate in a medium-to-high business risk environment, shaped by cyclicality, imported scrap reliance, and elevated energy costs. The Federal government's PSDP allocation for FY26 was raised to ~PKR 4.2 trillion (FY25: ~PKR 3.68 trillion), up ~15% YoY, and the FY26 budget also eased customs duties on key inputs — additional customs duty on steel scrap was cut from 2% to 0% and on melting scrap from 3% to 0%, while duty on semi-finished products such as billets was halved from 11% to 5% — improving cost competitiveness for local re-rollers. Reconstruction needs following the Jul–Sep 2025 floods across Punjab and Sindh, together with a government mark-up subsidy for construction and housing-sector tax incentives, are expected to support rebar demand, though the extent of translation into higher volumes remains contingent on the pace of public-sector project execution. On the monetary front, after an extended easing cycle through FY25 and 1HFY26 that had brought the policy rate down to 10.5%, the State Bank of Pakistan raised the policy rate by 100bps to 11.5% in April 2026 amid a spike in global oil prices linked to Middle East tensions, and has held it at that level through July 2026 — reversing part of the earlier relief to financing costs and keeping leverage-sensitive sector margins under continued pressure. Meanwhile, the copper segment remains exposed to global trade disruptions, including U.S.–China tariff tensions and regulatory shifts affecting scrap availability and export flows under Pakistan's Export Facilitation Scheme (EFS). Overall, sector profitability is expected to improve gradually, contingent on sustained demand recovery and a stable interest rate environment.

MISIL ranks among the leading long steel manufacturers in Pakistan. The Company benefits from a well-established brand, extensive dealer network, and diversified product portfolio. This diversification supports stable demand across market segments and enhances resilience against cyclical variations. Consistent operational performance, coupled with a sustained focus on quality and efficiency, underpins MISIL’s strong position within the domestic steel industry.

During FY26, MISIL reported net sales of Rs. 77,958 million (FY25: Rs. 89,414 million), a moderation of around 12.8%, mainly reflecting lower average selling prices and reduced export volumes. The domestic ferrous segment remained the backbone of the business, with sales volumes increasing over the previous year on the back of stronger local demand, primarily on account of housing and infrastructure requirements. This was reflected in higher production, with output at the melting furnaces rising by around 15.5% to 347,140 MT (FY25: 300,640 MT) and at the rolling mills by around 6.4% to 325,171 MT (FY25: 305,488 MT), against unchanged installed capacities of 590,000 MT and 630,000 MT, respectively. Ferrous sales held broadly steady at Rs. 71,402 million (FY25: Rs. 73,548 million) and contributed around 91.5% of net revenue. Non-ferrous sales declined to Rs. 6,630 million (FY25: Rs. 15,932 million), as operations of the segment have been temporarily suspended in view of prevailing market dynamics, volatility in international commodity markets and associated risks, with management prioritizing the domestic ferrous business.

During FY26, Mughal's gross margin improved to 11.1% (FY25: 9.1%), with gross profit rising to Rs. 8,657 million (FY25: Rs. 8,138 million) despite the lower topline. Cost of sales declined at a faster pace than net sales, supported by a more favorable sales mix as the Company focused on the domestic ferrous segment, enhanced operational efficiencies and disciplined inventory management. The net profit margin also improved to 3.2% (FY25: 1.08%), largely on account of lower finance costs, which declined to Rs. 3,821 million (FY25: Rs. 5,723 million) amid the easing interest rate environment. The improvement came despite a higher tax charge during the year, and net profit after tax rose to Rs. 2,487 million (FY25: Rs. 966 million).

MISIL demonstrates a growing commitment to sustainability through operational efficiency, responsible sourcing, and energy conservation. Its production facilities operate on Electric Induction Furnaces and Direct Rolling Technology, significantly reducing thermal energy usage, complemented by European-origin energy-efficient rolling mills and automated load management systems. The Company also utilizes a water treatment plant to recycle process water, reducing freshwater dependency. Supply chain sustainability is supported through the use of verified recycled steel scrap and a shift toward rail-based scrap transportation to minimize logistics emissions. Additionally, MISIL’s circular production model—converting steel scrap into finished products—positions it as a low-carbon steel producer. Additionally, the commencement of operations of the Company’s hybrid power plant and the balancing, modernization and replacement (BMR) of its bar re-rolling mill further support operational efficiency and long-term environmental resilience. On the diversification front, the Company's participation, as part of a larger consortium, in the privatization of Gujranwala Electric Power Company (GEPCO), which has progressed to the due diligence stage, reflects its intent to broaden its business base.

As at end-Jun'26, Mughal's working capital management remained sound, supported by a notable improvement in inventory management and a strong liquidity position. Inventory days improved further to 50 (FY25: 72), mainly on account of the disciplined inventory management and faster stock movement amid higher ferrous sales volumes, alongside the scaling back of non-ferrous operations, which carried higher inventory and price risk. Receivable days increased to 89 (FY25: 53), on account of higher local ferrous sales and a temporary slowdown in the June quarter, with all balances considered good. As a result, the net working capital cycle stood at 121 days (FY25: 110 days), with the longer receivable cycle partly offset by the shorter inventory holding period. The Company funds its working capital through internal cash generation, Sukuk placements and bank lines. Short-term borrowings stood at Rs. 21,616 million (FY25: Rs. 22,885 million), while a long-term facility of Rs. 10,000 million was availed from United Bank Limited to finance permanent working capital requirements. The liquidity profile strengthened, with the current ratio at 10.2x (FY25: 5.6x) and cash and bank balances of Rs. 6,661 million (FY25: Rs. 3,092 million).

Free Cash Flows from operations (FCFO) increased sharply to Rs. 8,018 million in FY26 (FY25: Rs. 5,668 million), a growth of 41.5%, following declines of 4.2% in FY25. The increase was supported by higher operating profitability and lower tax outflows during the year. Finance costs eased considerably to Rs. 3,674 million (FY25: Rs. 5,561 million), aided by the declining interest rate environment. As a result, the interest coverage ratio improved to 2.2x (FY25: 1.0x; FY24: 1.0x; FY23: 1.9x). The debt payback period stood at 3.8 years, reflecting the stronger cash generation despite higher borrowings.

As at end-Jun'26, Mughal's leveraging stood at 51.2% (end-Jun'25: 49.3%). Total borrowings increased to Rs. 38,068 million (end-Jun'25: Rs. 28,014 million), mainly on account of fresh long-term financing of Rs. 10.0bln from United Bank Limited for permanent working capital and Rs. 1.96bln from Bank of Punjab for the BMR of the bar re-rolling mill. Short-term borrowings reduced to 56.8% of total borrowings (end-Jun'25: 81.7%), reflecting a shift toward longer-tenor financing, while the Company continued to use short-term Sukuk for working capital needs and timely repaid them on maturity. Shareholders' equity increased to Rs. 36,216 million (end-Jun'25: Rs. 28,819 million), supported by profit retention and a revaluation surplus on fixed assets.