PACRA Upgrades Entity Ratings of K.K Rice Mills (Pvt.) Limited

The ratings of K.K Rice Mills (Pvt.) Limited (“K.K Rice” or “the Company”) reflects its emerging presence as a prominent rice exporter. K.K Rice specializes in the processing of semi processed non-basmati rice. The Company has strengthened its presence in Middle East and African region through strategic relationships and is committed to increase its foreign footings. K.K Rice leverages a well-equipped operational infrastructure to navigate the global rice export market successfully. During the year, the Company expanded its production capacity in the rice segment, reinforcing its operational scale and market presence. In addition, the product portfolio was further diversified with the induction of sesame seeds, enhancing the Company’s sustainability profile. The Company’s operations are strengthened by a highly qualified and experienced management team. During FY25, the Company reported a topline of PKR 21,100 million (1QFY26: PKR 1,986 million), marking a robust growth of ~195% over the past two years from PKR 7,167 million recorded in FY23. The Company maintained stable gross margins during the period, supported by disciplined cost management and favorable raw material pricing. Operating margins remained broadly aligned with prevailing inflationary conditions, reflecting effective operational and cost-control measures. The Company reported net income of PKR 111 million (1QFY26: PKR 24 million) for the period, representing an increase of ~127% compared to PKR 49 million recorded in FY23. The Company’s financial risk profile remains the moderate, supported by the Company’s highly leveraged capital structure, and the working capital primarily financed through short term borrowings. Furthermore, ratings take comfort from the sponsors’ depth of experience and unwavering commitment to accelerating the Company’s growth, this reinforces the ratings and strengthens the outlook for sustained operational success.
Rice is a strategically significant crop within Pakistan’s agricultural economy, serving as both a staple food and a major source of export earnings. In FY25, the agriculture sector accounted for approximately ~23.5% of national GDP, with crops contributing ~32.8% to agricultural value addition. Within this, rice represented around ~11.7% of important crops and contributed an estimated ~0.6% to overall GDP, underscoring its macroeconomic relevance despite being a single-crop segment. Rice exports totaled ~5.8 million MT in FY25, generating export revenues of approximately USD 3.35 billion. Although export value declined 14.7% YoY, rice still contributed ~10.5% of Pakistan’s total export proceeds, ranking among the top three exportable commodities.
The ratings are dependent on the management's ability to improve the revenue streams through better distribution channels. Prudent management and maintenance of a stable financial risk profile, especially in terms of the working capital, cash flows, and coverages is imperative for the ratings. Additionally, debt servicing, capitalizing international demands, and envisioned improvements in qualitative factors, going forward, remain crucial for the ratings.

About the Entity
K.K Rice Mills (Pvt) Ltd was incorporated in 2009 as a privately limited company. The Company is primarily involved in the business of exporting non-basmati rice. It has two rice processing plants located in Port Qasim and Nooriabad. K.K Rice is majorly owned by Mr. Chela Ram (~50%), The Board comprises four members and is dominated by the Sponsoring family. Mr. Chela Ram, Chairman of the Board and CEO of the Company, holds an experience of over two decades in the rice business. He is assisted by team of experienced professionals.