⚡ Flash Summary

Dewan Salman Fibre Limited’s (DSFL) Annual Report for the year ended June 30, 2025, reveals a challenging financial landscape marked by continued operational closure and significant accumulated losses. The company’s turnover remained nil due to the cessation of manufacturing activities since December 2008. While management is actively pursuing debt restructuring with financial institutions, an adverse opinion has been issued by the auditors regarding the use of the going concern assumption, adding further uncertainty. The report highlights the Company’s endeavors to navigate these difficulties, including efforts to reduce costs and manage feedstock price changes.

📌 Key Takeaways

• ❌ DSFL reported zero revenue for the year ended June 30, 2025.
• 📉 The company experienced a Gross Loss of PKR 283.045 million.
• 😓 Operating Loss widened to PKR 345.904 million.
• ⛔ Auditors issued an adverse opinion due to concerns about the ‘going concern’ assumption.
• ⚠️ Financial statements preparation is questionable.
• 🔍 Trade debts are stagnant, raising concerns about recovery.
• 📉 Loss per share stood at (PKR 1.04).
• 🚫 No dividend declared due to adverse financial conditions.
• 🏢 Company’s operations have been closed since December 2008.
• 🤝 Debt restructuring proposals are ongoing with financial institutions.
• 🌍 PSF market faces significant competition from international players.
• 🇵🇰 The company is exposed to Pak Rupee depreciation risk against the US Dollar.
• 🚫 The company is lacking the Non-availability of banking lines.

🎯 Investment Thesis

Due to the adverse opinion from auditors, continued operational closure, increasing losses, significant debt and the inherent risks, a SELL recommendation is warranted. There is no reason to expect a turnaround, considering existing challenges and auditors’ concerns. A price target is based on potential asset liquidation value, though highly uncertain. Any potential investor should avoid this security, as per the current situation and report.