⏸️ BTL: HOLD Signal (5/10) – Miscellaneous Information

📌 Key Takeaways

• ⚠️ BTL’s Corporate Briefing Session was held on November 21, 2025, via Zoom.
• 📉 The company posted a loss before and after tax of PKR -96.881 million for the year ended June 30, 2025.
• ⬆️ This is an improvement compared to the previous year’s loss of PKR -1,706.231 million.
• 📉 Sales declined marginally by 4% year-over-year.
• ⬆️ Gross margin increased from 4% to 7%.
• 🌍 45% of total revenue comes from exports to the European Union, USA, and Far East.
• 🏭 The company operates three spinning units with 87,888 spindles and one weaving unit with 150 looms.
• ⚠️ The company is experiencing increasing inventory levels due to intense competition.
• 🧶 Slower global demand for cotton yarn is a key challenge.
• 🌍 Geopolitical tensions and stricter sustainability regulations add pressure.
• 🇺🇸 Imposition of tariffs by the United States impacts the textile sector.
• 🏛️ Recent tax reforms have compounded financial challenges.
• 👍 Credit rating reaffirmed at ‘A/A-1’ with a ‘Stable’ outlook by VIS Credit Rating Company.
• 👥 The governing board comprises of 10 members.
• 🏢 Authorized Capital is PKR 65,000,000, and Issued Paid-up Capital is PKR 64,320,000.

🎯 Investment Thesis

HOLD. BTL has shown improvement in its gross profit margin and a significant reduction in its losses. However, ongoing challenges in the textile sector, along with BTL’s negative profitability, suggest a conservative approach. While the company’s efforts to increase efficiency and exports are positive, external factors and internal restructuring need more time to yield sustainable profitability. It is recommended to reassess the investment thesis as the company demonstrates consistent positive earnings and mitigates its financial and market risks.