The Pakistan Credit Rating Agency Limited
Press Release


Muhammad Atif Chaudhry

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PACRA assigns Initial entity rating to Dynamic Packaging (Pvt.) Limited

Rating Type Entity
(17-Jan-23 )
Action Initial
Long Term BBB
Short Term A2
Outlook Stable
Rating Watch -

Dynamic Packaging (Pvt.) Limited (‘DP’ or ‘The Company’) is predominately manufacturing different types of Flexible Packaging, Pharmaceutical Sachet, Tropical Blister Foil, Aluminum Blister Foil, and Cold Forming Aluminum Foil packaging. The Company is wholly owned by family members. Family businesses include i) Dynamic Packaging (Pvt.) Limited ii) Global Inks & Chemicals (Pvt.) Ltd iii) Royal Traders. The Company is backward integrated wherein, Global Inks & Chemicals (Pvt.) Ltd is providing a complete range of solvent-based ink systems for the Rotogravure & Flexographic printing industries across Pakistan. The demand for packaging products is mainly derived from the food and pharmaceutical industry. The strong customer base of the Company bodes well for the assigned rating. The sponsor’s family has vast experience in packaging and engaged in this business since 2004. The raw material of the finished product is ~100% imported hence, exposed to exchange rate risk. As per management representation, the Company has captured a good share of the flexible packaging market. While being the sole manufacturer of pharmaceutical packaging in Pakistan, the company holds ~ 5% market share, the rest of the market of ~95% is captured by importers. The actual capacity utilization was ~ 64% during FY22 (FY21: ~60%). Considering the growth in the pharma sector, capacity utilization is expected to increase further, going forward. The internal audit department is operating under the direct supervision of directors. The Company has developed an effective mechanism for the identification, assessment, and reporting of all types of risk arising out of business operations.
On the financial profile of Dynamic Group has generated a topline of ~ PKR 5,377mln in FY22 as compared to ~PKR 4,906mln in FY21. In FY22, bottom line of ~PKR 148(FY21: ~PKR 186mln). Equity stood at ~PKR 1,868mln at the end of FY22(FY21: ~PKR 1,720mln). The Company is low leveraged with sound financial indicators as of the end of Jun’22.
The ratings are dependent upon the management’s ability to improve margins while sustaining its market share. Prudent management of the working capital, and maintaining sufficient cash flows and coverages are essential for the ratings. Any significant change in margins and coverages will impact the ratings.

About the Entity
Dynamic Packaging (Pvt.) Limited was founded as a private limited company on 23rd June 2004 and is currently engaged in the commercial production of Flexible and Pharmaceutical Packaging. The Company’s manufacturing plant is located in Raj Industrial Park Dullu Kalan. The Company is wholly owned by the sponsor family with major ownership of ~72% residing with Mr. Ashraf Ch, followed by Mr. Waqas Ashraf and Ms. Shazia Ashraf hold respectively ~20% and ~8% ownership of the Company.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.