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The Pakistan Credit Rating Agency Limited
Press Release

Date
27-Jan-22

Analyst
Iram Shahzadi
iram.shahzadi@pacra.com
+92-42-35869504
www.pacra.com

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This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Assigns Entity Ratings to KAM International

Rating Type Entity
Current
(27-Jan-22 )
Action Initial
Long Term A-
Short Term A2
Outlook Stable
Rating Watch -

KAM International is a prominent textile venture of Mekotex group. The group has presence in textile, energy and water supply sectors through five established companies Mekotex, Meko Denim, Innovative Energy Solutions, Aquagen & KAM International. The Company has been operational as a single member company with history of more than two decades. The Company is principally engaged in the manufacturing and export of home textile (Bedding sets and variety of napkins, towels and table cloth). Broad product slate has assisted the company in strengthening its position over the years. The Company’s management involves experienced professionals, aided by comprehensive reporting, looking after operations of the Company with complete autonomy. Its established business profile emanating from strong presence in the broader value-chain; enabling the company to manage volatility in the textile industry. Sales mix, dominated by exports, displays a steady improvement over the years. The Company enjoys established customer base with several export destinations in European Countries (80%) and United States of America (20%). The management is planning further penetration in USA/ Canada market in the upcoming years. During FY21, the Company’s revenues recorded sizable increase to PKR 10.4bln (FY20: PKR 7.99bln), where 97% (FY20: 94%) vests with exports. Net profitability also witnessed improvement whilst margins remained strong. The Company continues to maintain a low leveraged capital structure and strong coverages signifying its very strong financial profile. Going forward, further strengthening of business profile is eyed with the planned expansion.
The ratings are dependent on sustaining the business profile of the Company by maintaining profitability and margins achieved from core textile operations. At the same time, sustainability of income and prudent management of the surplus funds are important.

About the Entity
KAM International was incorporated on August 7, 1996 as a single-member company. The Company has a highly integrated network of ginning, spinning, weaving, printing, dyeing, finishing, cutting & stitching units under their own setup. One of the largest home textile exporters from Pakistan, and leading supplier to top importers & retailers, by providing the complete home solutions to the end consumers. At present, Kam International supplies directly to majority of private and famous retail brands of UK, USA and Europe. The textile operations of the group are segregated into five businesses –Mekotex, Meko Denim, Innovative Energy Solutions, Aquagen & KAM International (Apparel), the group has diversified itself into energy and water supply projects, generating a stable stream of income. Annual turnover of the group exceeds ~USD 250mln per annum.
Mr. Shoaib Majeed is the owner of the Company. He carries twenty-five years of professional experience and graduated in Business Administration. The position of CEO is with Mr. M. Ashraf. He carries professional experience of around three decades. He is assisted by a professional and long associated management team. M. Saleem Associates Chartered Accountants is the external auditor 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.