Ghulam Rasool & Company (Pvt.) Limited (“the Company” or “GRC”) is incorporated as a private limited company in 1984 under the Companies ordinance 1984 (now the Companies Act 2017). Its head office is situated at 195- D-1 Model Town, Lahore, Pakistan. The regional offices of the Company are located in Islamabad and Peshawar.

GRC was founded in 1965 by Mr. Ghulam Rasool and later passed on to his three sons and their families, who are the joint owners of the business. The Company was formally registered as a private limited entity in 1984. GRC is the leading provider of high-end engineering, procurement, and construction services. With over six decades of experience in civil engineering, the Company has successfully completed various projects in water management and irrigation systems. It has delivered numerous public and government projects, building a strong reputation for undertaking and successfully completing large-scale infrastructure projects.

The Company is primarily engaged in the construction and development of infrastructure projects, including river bridges, barrages, roads, underpasses, flyovers, canals, and irrigation systems. It is now expanding its focus to include the construction of hydropower plants and related services. Notable projects include the Kacchi Canal KC-05, 84 MW Hydropower Plant in Kalam, 12 MW projects in Karora and Jabori, the Daral Khwar Power Plant, the Pehure Canal in KPK, the Earthquake Memorial Bridge in Muzaffarabad, and the Lowari Tunnel, along with International Projects in Ethiopia, UAE, and Afghanistan. It holds a no-limit contract license from the Engineering Council of Pakistan.

The family business has been operating since the 1965, and was inherited from Mr.Ghulam Rasool to his three sons. Currently, the shareholding is held by web of close relatives. The latest shareholding, as per the “form A” of the Company, is as follows: Mr. Majeedullah Khan (22.81%), Mr. Amanatullah Khan (13.94%), Mr. Faisal Hassan Khan (12.43%), Mst. Ashraf Bibi (19.1%), Mst. Naseem Akhtar (11.85%), Mr. Sheheryar Khan (7.21%), Mr. Muhammad Awais Khan (4.22%), Mr. Muhammad Hassan Khan (4.22%), and Mr. Muhammad Ahsan Khan (4.22%).

Ownership has remained with the sponsoring family since the Company’s inception, and no changes are anticipated in the near future. Although there is no formal succession plan in place, a verbal understanding and the clear division of responsibilities among family members contribute to stability in the ownership structure.

The sponsoring family has been in the construction industry for many decades. The sponsors possess a comprehensive understanding of the business, as they are actively involved in the day-to-day operations.

The shareholders hold stakes in multiple companies, reflecting a diversification of income streams, which contributes to the Company’s financial stability. Additionally, the sponsors own numerous properties across various locations in the country, further strengthening the financial profile of the Company.

The overall control of the Company rests with a four-member board, all of whom are family members and shareholders. The board members include Mr. Majeedullah Khan, Mr. Faisal Hassan Khan, Ms. Ashraf Bibi, and Mr. Sheheryar Khan.

The board members have extensive executive experience and a vested interest in the Company's success as shareholders. Mr. Majeedullah, a substantial shareholder, brings over 30 years of strategic management and leadership expertise. The collective expertise of the board members ensures the Company's ability to navigate complex business challenges.

There are no formal board committees. The board members are actively engaged in planning, executing business projects, and overseeing daily operations, with all holding executive roles within the Company. While this ensures direct involvement in the Company's activities, the board structure could be strengthened by the addition of independent members to enhance impartial oversight and improve overall governance.

As a private company, GRC's financial statements and annual reports are not publicly available. The Company's auditor, Naveed Zafar Ashfaq Jaffer & Co., a Category A auditor and an associate of PrimeGlobal, was appointed in place of Crowe Hussain Chaudhury & Co. for FY 2024. The auditors have issued an unqualified opinion on the financial statements of the Company for the period ending June 2024.

The organizational hierarchy of GRC is well-structured, the functional and reporting responsibilities of the management team are demarcated. Department heads report directly to the CEO and are supported by a team of experienced members, ensuring efficient operations and decision-making.

The Company boasts a strong blend of expertise, knowledge, and experience within its management team. The team members are seasoned professionals with extensive hands-on experience in their respective fields. Mr. Majeedullah Khan serves as the CEO, while Mr. Muhammad Uzair Aslam holds the dual role of Company Secretary and CFO.

The management functions are clear and well-defined, ensuring the effective achievement of the Company's goals and objectives. The board members closely oversee the team to ensure successful execution. Additionally, the board plays an active role in preparing project bids. The management holds regular meetings to discuss Company affairs, though the documentation of these meetings is not formalized.

GRC utilizes Primavera P6 Version 8.2, an enterprise project portfolio management software that offers project management, product management, collaboration, and control capabilities. It seamlessly integrates with other enterprise systems, including AutoCAD Civil 3D and cash flow management systems, enhancing overall operational efficiency and coordination. The Company has successfully transitioned to an Oracle-based system, which enhances operational efficiency and improves the frequency of reporting.

GRC maintains a comprehensive and detailed SOP document, outlining instructions for machinery operation, dispatching, and cash transfers/payments to ensure compliance. The Company has an in-house Internal Audit Department, appropriately sized for its nature and scale. Additionally, GRC plans to transition its internal controls to the Oracle system to enhance reliability and streamline operations.

The Public Sector Development Program (PSDP) for fiscal year 2024 (FY24) saw an increase of approximately 30.7% year-on-year (YoY), reaching PKR 950bln. Under the Current and Development Expenditure on the Revenue Account, a specific allocation has been made for Construction and Transport. The total amount for these sectors is PKR 40.5bln for Current Expenditure and PKR 39.1bln for Development Expenditure. In comparison to the previous fiscal year (SPLY), these figures have slightly changed, with allocations for Construction and Transport last year being PKR 30.2bln and PKR 55.2bln, respectively.

GRC has good potential and lies at par with the well performing companies. When it comes to competitive advantage GRC has an edge due to operational and geographical diversification. Comparing up to last two fiscal years, GRC lies among top tier construction companies, it can be fairly titled to be a large entity, with an equity of PKR 15.3bln. Additionally, the Company specializes in the construction of hydropower projects, an area with growing demand, further enhancing its competitive edge. GRC collaborates with joint venture partners, including established institutions from China, Europe, the UAE, and Korea, further strengthening its position in the industry.

GRC's revenues remained steady at approx. PKR 12bln in FY24 (FY23: PKR 12.9bln), driven by the securing of sizable, multi-year contracts. However, the FY24 revenue was lower than the management's expectation of PKR 17bln, primarily due to delays in the disbursement of funds, which led to a slowdown in project activities. The Company has also diversified its offerings by providing shutdown maintenance services for refineries, oil, and gas plants. Additionally, GRC has earned revenue from selling electricity through a solar power plant installed at the Institute of Engineering & Technology and Women University in Multan.

GRC's gross margins increased to 20.4% in FY24 (FY23: 12.5%), while operating margins improved to 16.7% (FY23: 11.8%). This improvement was driven by completing projects with minimal overhead costs, procuring materials at better pricing, improving vendor management and strengthening the supply chain. Despite the improvement in gross margins, the Company's net profit for FY24 was PKR 1.56bln (FY23: PKR 1,6bln), resulting in a slight decline in net margin to 12.5% (FY23: 12.7%). The decrease in net margins is attributed primarily to higher taxation.

The Company maintains a sound pipeline of ongoing and upcoming projects, reflecting its strong market presence and operational capabilities. Recent diversification efforts underline its commitment to a sustainable future through the execution of efficient and high-quality projects. With a focus on technical competency. The management is also optimistic about securing several mega projects, including the Madyan Hydro Power Project, Gabral Kalam Hydro Power Project, the rehabilitation of DD1 and DD2 at KSEW, and the Ranolia GIS project. The Company has successfully prequalified for some of these projects and remains confident in its ability to secure a substantial share, further strengthening its project pipeline and ensuring long-term sustainability.

GRC's working capital needs are influenced by its inventory, receivables, and payables management. In FY24, trade receivable days increased to 106 (FY23: 59 days), primarily due to delays in fund releases from departments. Inventory days slightly improved to 97 (FY23: 100 days), while payable days rose to 81 (FY23: 69 days). Consequently, net working capital days extended to 123 in FY24, up from 90 days in FY23. To meet its working capital requirements, GRC relies on both internal and external financing sources. Externally, the Company primarily utilizes unfunded lines in the form of guarantees, which are integral to its business operations. Funded exposure remains minimal, recorded at PKR 275mln in FY24 (FY23: PKR 268mln).

FCFO’s of the Company were recorded at PKR 1,916mln in FY24 (FY23: PKR 2,750mln) while finance cost was recorded at PKR 195mln (FY23: 77mln). Resultantly coverage ratio was recorded at 30.4x in FY24 from 50.4x in FY23.

GRC maintains an almost unleveraged capital structure, with a gearing ratio of just 2% in both FY24 and FY23, reflecting minimal reliance on bank borrowings for its business operations. Instead, the Company primarily utilizes non-funded credit facilities, such as bank guarantees. Off-balance sheet exposure remained steady, recorded at 42.6% in FY24 compared to 42.5% in FY23.