2

TERM REPORT
CORPORATE FINANCE

MUHAMMAD ABID
MARIA SHAKEEL
RUTABA
DANISH KUMAR
SHAWAIZ NISAR

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Group Member:
Rutaba Adeel
20181-24599

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COMPANY OVERVIEW

TPL Trakker Ltd is one the Pakistan’s leading IoT company that provides superior quality
GPS, GSM & Satellite Mobile Asset Tracking Management, and Information Solutions. It is
pioneer in the GPS tracker industry in Pakistan. It includes Car Tracking Units, Software,
Operational and Project Management Expertise, Deployment, Data Evaluation, and
Consultancy. Modified solutions such as Stolen Vehicle Recovery Assistance, Fleet
Management Solutions, Safe Transport Environment, Trakker NAV, Personal Tracking, and
e-Solutions are also offered to clients looking for tailored services to meet very specific
needs.
TPL Trakker Ltd vision is to create value through digital transformation. It has been
providing innovative solution since last two decades and strives for a better future. TPL
Trakker is also very active in CSR activities. Its key performance is in the domain of
Education, Environment and Health. Consequently, TPL Trakker has been awarded with
various certificates and achievement awards.

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COMPANY PROFILE

SUBSIDIARIES:

The Company currently holds 29% stake in Trakker Middle East LLC with it being the
Company's Associated Company. The Company is currently in the process of acquiring a
further 21% stake in Trakker Middle East LLC which will give the Company controlling
interest in it and it shall become Company's subsidiary.

MANAGEMENT:

 Sarwar Ali Khan (Chief Executive Officer)

 Muhammad Faizaullah (Chief Operating & Transformation Officer)
 Malik Ahmed Sheheryar (Chief Financial Officer)
 Jameel Yusuf (Chairman/Director)
 Brigadier Muhammad Tahir Chaudhary (Non-Executive Director)
 Muhammad Riaz (Director)
 Ahmad Zuberi (Director)
 Ali Asgher (Director)
 Nausheen Javaid Amjad (Director)
 Omar Askari (Director)

REVENUE MODEL:

TPL Trakker Ltd has highly diversified revenue stream that helps the company to grow every day.
Follow are some major revenue drivers of TPL Trakker Ltd.

 Sale of New Automobile.

 Increase in Insurance penetration and auto finance
 Increased Awareness of safety of Heavy vehicle
 Afghan Transit Trade.
 Government Regulations Promoting Demand for IoT.
 Pakistan Burgeoning Middle Class
 Arrival of OEMs.

COST MODEL:

The major cost of the TPL Trakker LTd is divided into three major categories which are as follows

 Cost of Raw Material.

 Cost of labor.
 Increasing preference for rental Based pricing Model.

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RATING:

The Company stands as a public listed company since Aug’20. Currently, the Company’s
financial risk profile exhibits improved interest and debt coverages alongside capital
structure and cash conversion cycles, endurance of which is necessitated.
The ratings incorporate TPL Trakker's prominent position in Pakistan’s tracking industry, As
diversity becomes inevitable to sustain in its operating segment, the Company is gradually
shifting towards business avenues that are more beneficial for company’s growth. The new
segments have already achieved above par results, however, incremental yet consistent cash
flows remain pivotal. The Company has acquired majority stake in Trakker Middle East
LLC, with a view to enhance its presence in the Middle East market.

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IPO FUNDING

Purpose:

 Procurement of Container Tracking Devices

 IT Infrastructure CAPEX
 Enhancement of location data acquisition, digitization and maintenance infrastructure
 Working Capital Requirement
 Commercial Paper Issuance
 Payment to Related Party

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Competitors
TPL Trakker currently dominates the asset tracking service industry in Pakistan and is the leading
service provider in the areas of vehicle telematics, fleet management, portfolio management and
vehicle recovery services. Notwithstanding the market leader position of the Company, the entry of
a new player(s) with the direct or indirect support of an international player might enhance the level
of competition in the industry in the long run and affect Company’s market share in future. While
there is threat of new entrants, TPL Trakker’s strong brand recognition, market know-how and
superior IT and support infrastructure which has enabled it to beat the competition and enjoy a
dominant position in the asset tracking service market in Pakistan. Any new entrant into asset
tracking service market in Pakistan at this stage or in future will have to make substantial investment
of resources and of time to match Company’s infrastructure.

Sales

Profit Margins

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Debt to Asset Ratio:

The Debt to Asset Ratio of TPL Trakker Ltd before IPO Funding was 72% which significantly higher
representing that most of the company’s assets are financed through debt. However, the Debt to Asset
Ratio after IPO funding is 68% representing an increase in the proportion of equity financing.

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RETURN:

The table below represents the total return earned by the shareholder. The price of the stick
dipped after 30 days of IPO Funding resulting in a decline of returns. However, the stock
outperformed the market, and its annualized return is 12.61%. Thus, TPL Trakker Ltd
reported a good return in comparison of KSE 100.

KSE 100 Difference

Time Till date
Listing since 30 365 Annualize Annualize Annualize
Company Cumulative Cumulative
date listed days days (Cumulative) d till date d d
(yrs.)
23- -
TPL Jul-20 1.71 17% 48% 8.67% 4.99% 16.52% 9.37% -7.86% -4.38%

TPL Prices

23-Jul-20 12

7-Apr-22 13.04

After 30 Days 10.02

After 365 Days 17.81

KSE 100

23-Jul-20 37,578.21

7-Apr-22 43,786.83

   

Years 1.71

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Company Overview
Experts in the conventional norms of the industry, Organic Meat Company Limited is one of
the very few meat processing plants in South Asia that specializes in beef, mutton and edible
offal of the healthiest, grass fed and free range animals from the green agricultural lands of
Pakistan. They are certified and audited by various international food safety and veterinary
authorities on a regular basis. The outstanding production facility, tremendous capacity, and
good manufacturing policies at The Organic Meat Company Limited ensures tender, tasty
and safe meat. It main competitor is MeatOne.
The Organic Meat Co. was incorporated in 2010. The company has no subsidiaries by the
virtue of shareholding. It is situated at plot no. 257, sector 24, Korangi Industrial Area,
Karachi.

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Company Profile: (PACRA / VIS report)

 Chairman
Chairman is Mr. Nihal Cassim. He serves as the Chief Executive Officer of
Safeway Fund Limited and also handles the affairs of Asian Stocks Fund Limited.
He is also a Non- Executive Director of Ferozsons Laboratories Ltd. In addition to
his position at Ferozsons Laboratories Limited, he is currently a Director on the
Boards and Audit Committees of Safeway Fund Limited, Pakistan Oilfields
Limited, National Institutional Facilitation Technologies (Pvt) Limited (NIFT)
and its subsidiary ISM (Pvt) Limited.
 Chief Executive Officer
Chief Executive Officer is Mr. Faisal Hussain. He has over 20 years working
experience in the sheep casings (meat offal processing) industry and 10 years of
experience in the meat processing industry. He is the Founder
Shareholder/Director & CEO of the Company. He holds a “Master of Business
Administration” Degree from respected Institute of Business Administration
(IBA) and a “Master Of Finance” Degree from Cardiff Business School,
University of Wales, UK.

 Board of Directors and Management

1. Mr. Nihal Cassim (Chairman)
2. Mr. Faisal Hussain (Chief Executive Officer / Director)
3. Mr. Syed Imran Ali (CFO / Director)
4. Mr. Ali Hussain(COO / Chief Operating Officer and Executive Director)
5. Mr. Rizwan Pinjwani (Executive Director)
6. Mr. Aneek Saleh Mohammad (Independent Director)
7. Mr. Owais Zaidi (Independent Director)
8. Ms. Sehrish Hafeez (Independent Director)

 Revenue model: What company do? How many revenue streams? How
revenue generated?

The Organic Meat Company Limited produces Fresh, Frozen, Vacuum Packed Beef and
Mutton Meat products.
Revenue Streams
1. Exports
TOMC's supplies products to Iraq, Kuwait, Oman, Qatar, Kingdom of Saudi Arabia
("KSA"), United Arab Emirates ("UAE"), Bahrain, Egypt, Azerbaijan, Malaysia, Hong
Kong, Myanmar, Maldives and Vietnam. Whereas efforts are underway to procure approvals
for new markets such as China, Thailand and Russia.
2. Domestic Supply

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TOMC supplies Fresh, Frozen, Vacuum Packed Beef and Mutton Meat products all over
Pakistan.

3. Commercial
TOMC allows other companies to use their machinery to complete their contracts. TOMCL
charges them on the basis of tons of meat.
The Products of The Organic Meat Ltd. are in wide range and variety.

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Key Revenue Driver:

o Market Access:
The most important aspect in the meat industry is the market access. TOMC has the greatest
market access from Pakistan. Recently, TOMC has successfully qualified to become a vendor
to Malaysia, Egypt and large processors of UAE and Commonwealth of Independent States
(CIS).
o Growth of the meat Sector:
The demand for TOMC's product line is dependent upon the overall household income levels
as well as meat consumption in the destination markets. Recent times have seen that TOMC's
export markets are witnessing a rising middle class, expanding GDP and resultantly an
increasing consumer spending trend. This is expected to continue for meat business in the
medium to long term as well.
o Expanding Product Base:
Pakistan's meat export sector has largely remained reliant on fresh meat exports. However,
TOMC has concentrated on increasing its product portfolio by introducing new, value added
products. As a result TOMC is able to create a differentiation between kistani meat exporters
and itself. Today, no other company deals in Offal, which is a higher margin segment of the
industry and TOMC is the only player in this segment. Furthermore, TOMC's facilities have
one of the largest frozen, deboned capacities, allowing greater access as international markets
look to avoid boned meat owing to Foot & Mouth disease in Pakistan. Another addition to
the Company's product portfolio is the chilled vacuum packed category. This segment is
particularly interesting since through vacuum packaging the life and taste of the meat are
retained for 5 times the shelf life of a chilled product.

 Cost model: Major cost driver

o Animal Procurement
Animal Procurement costs are a major component of the Company's cost of
sales and account for about 93% of the total COGS. The livestock is sourced
from domestic suppliers according to prevailing demand and supply
conditions. Any material change in the rapid availability of the animals or
prices thereof could have a potential impact on the Company's meat
production. In future, TOMC intends to directly procure from farmers,
livestock farms and livestock markets, eliminating the intermediaries and
hence increasing the margins.
o Freight Cost
The products offered by the Company are perishable items and have a very
limited shelf life. The finished product is exported to different destinations
through various cargo agents who make agreements on behalf of airlines or
shipping lines. The cost of freight is an important cost that needs to be kept in
check for efficient supply chain.
o Packaging cost
Another major cost for the Company is the packaging cost. The final product
utilizes different sorts of packaging material. Meat is packaged in hygienic,

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high quality material to ensure that the meat stays pure and clean. Any
increase in the procurement price of the material used in the packaging has a
negative
impact on the overall margins of the Company.

 Rating: Long term and short term

• Long term: A-
1. Good credit quality
2. Protection factors are adequate
• Short term: A2
1. Good certainty for timely payment
2. Liquidity factors and company fundamentals are sound

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IPO Funding:
 Purpose
The principal purpose of the issue is to increase its current product output through the
utilization of IPO funds as well as set up 2 (two) new facilities for the processing of
Offal. First facility would be set up at Korangi Industrial Area Karachi for processing
of locally procured raw offals while the second facility would be set up at the Export
Processing Zone, Port Qasim Karachi for processing of imported raw offal with
purpose of re-export.

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 Returns

            KSE 100 Difference

Ti
me
sinc Price Return
Listi Till date Annualiz
Compa e after listing Cumulati Annuali Cumulati Annuali
ng ed till
ny liste ve zed ve zed
date date
d
(yrs (Cumulati 30 365
.) ve) Days Days
3-
Organi Aug- 1.6 18.93 81.07
c Meat 20 8 29% 16.19% % % 10% 5.72% 18.85% 10.47%
Divide
nd     8%

Return     21%

Organic Meat Prices

3-Aug-20 21.5
7-Apr-22 26
After 30 Days 25.57
After 365 days 38.93
KSE 100
3-Aug-20 39,870.61
7-Apr-22 43,768.83

Years 1.68

The table above represents the total return earned by the shareholder. The price of the stock
increased after 30 days of IPO Funding resulting in a increase of returns. The stock
outperformed the market, and its difference in annualized return is 10.47%. Thus, The
Organic Meat Ltd reported a good return in comparison of KSE 100.

 How will generate proceeds to refund

 By generating Revenue using its streams.
 Sales in year:
2020: 3,384,109,000
2021: 3,927,824,000
 By paying dividend to shareholders.

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 Debt to Total Asset ratio (before / after funding). It means you will show only
two numbers’

Debt to total Asset ratio was around 36.8% before funding and around 30.8% after
funding.

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Group Member:
Shawaiz Nisar
20181-24265

Company Overview
Interloop Limited (“Interloop”, or the “Company”) is one of the world's largest hosiery manufacturers
and has an annual turnover exceeding PKR 30 billion. Besides Hosiery, Interloop is also a reputed
manufacturer of quality yarn. It was commenced in 1992, in Faisalabad.
The Company offers a wide range of socks and tights with various quality levels and price points in
line with all types of customers including brands, retailers, and specialty stores etc. besides quality
yarns for denim, hosiery & weaving industry. Approximately 90% of the revenue generated by the
Company is through exports and it is the 7th largest exporter of Pakistan.

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Company Profile: (PACRA / VIS report)

 Subsidiaries
IL Apparel (Private) Limited is a fully owned subsidiary of Interloop Limited. The
Company to date has invested PKR 301 million in the company. IL Apparel is formed
to expand Interloop’s product range by entering into apparel products.
As of today, it has not commenced commercial operations.

 Board of Directors
1. Mr. Musadaq Zulqarnain (Chairman)
2. Mr. Navid Fazil (Chief Executive Officer / Director)
3. Mr. Muhammad Maqsood (CFO / Director)
4. Mr. Jahan Zeb Khan Banth (Non-Executive Director)
5. Mrs. Shereen Aftab (Non-Executive Director)
6. Mr. Tariq Iqbal Khan (Independent Director)
7. Mr. Saeed Ahmed Jabal (Independent Director)

 Revenue model: What company do? How many revenue streams? How
revenue generated?

Interloop is an international market leader in producing wide range of top-quality socks for
distinguished brands and retailers. Along with tights and leggings yarn and denim jeans.
Its major customers are the leading brands like Nike puma adidas Levi’s and many as
mentioned.

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 Key Performance Driver:

o Increase in Production Capacity:

Interloop currently produces c. 530+ million pairs of socks/tights each year. The Company is
in an expansionary phase and with the addition of Hosiery Division V, Interloop will have an
estimated actual production capacity of c. 75 million dozen of socks each year.
o Growth in Hosiery & Denim Sector:
The global hosiery and denim segments are forecasted to grow at a faster pace in the next
few years. Interloop is planning to capitalize on this opportunity by increasing its production
capacity for the expected growth in demand.
o Expanding Product Base:
With the targeted expansion, Interloop is entering into denim business. By adding new
product range in its portfolio, Interloop will not only open new avenues for its revenue
generation but will also add diversification in its operations.
o Product Development:
A significant factor in Interloop’s continuous growth is its ability to anticipate changes in
technology, industry standards and customer preferences and to successfully develop new
products in time. Established in 2004 as a section with 4 knitting machines to fulfill business
needs of the time, Product Development (PD) evolved into a complete Vertical Sampling
Facility by 2014.
o Research & Innovation:
Innovation has been an integral part of Interloop’s business strategy since inception. In
2013, a dedicated and self-sufficient Research & Innovation (R&I) Centre was set up in
Pakistan. The R&I Center is equipped with hitech machines and a modern lab, and is looked
after by an extremely competent team.

 Cost model: Major cost driver

o Cost of Raw material

Cotton is the key raw material for manufacturing of textile related products.
A shortage in cotton production due to poor farming or natural disaster
might increase the cost of raw material due to shorter supply.
o Cost of Labor
A shortage of skilled labor or an increase in min wage rate increases the cost
of labor for interloop, however company is in process to develop lean
manufacturing hiring ex Toyota employees.
o Shift in Consumer choice
Rapid changing consumer Demand, company have to invest in Capex and
R&D budgets at a faster rate, resulting in an increase in fixed cost of
production.

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 Competitor
Interloop face competition from Soorty, Artistic and Levi’s.

 Sales

 Profit Margins

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 Rating: Long term and short term

Long term rating of A+ signifies good credit quality with adequate protection factors.
Risk may vary due to economic conditions.

Short term rating of A-1 indicates high certainty of timely payments, good liquidity
supported by good fundamental protection factors.

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IPO Funding:
 Purpose

The main Principal Purpose of the issue is to finance the expansion project, like
adding a new production facility In Faisalabad and moreover setup a denim
production facility for stitching denim jeans in Lahore.
The company is planning to have a debt-to-equity Ratio of 56:44, and for this
purpose Interloop’s tends to issue around 109 million Shares at a floor price of
Rs.45.

Utilization of Funds Raised:

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 Returns
KSE 100 Difference

Time Price
Listing since Annualized Return Annualize Annualize
Company Till date   Cumulative Cumulative
date listed till date after d d
(yrs.) listing

365
        30 Days        
Days

Interloo 5-Apr- - -
p 19 3.01 71% 19.60% 10.52% 14.88% 17% 5.27% 54.67% 14.34%
Dividend
Yield     13%

Return     58%

Interloop Prices
5-Apr-19 46.1
7-Apr-22 73
After 30 Days 41.25
After 365 days 39.24
KSE 100
5-Apr-19 37,521.81
7-Apr-22 43,786.83

Years 3.01

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 How will generate proceeds to refund

Interloop will Proceed to refund by offering dividends while it continues to earn

revenue through manufacturing streams. As of now 7th April 2022, Interloop have
given around 13% to its customers. (Dividend Yield)

 Debt to Total Asset ratio (before / after funding). It means you will show
only two numbers’

Interloop
Debt To Asset ratio   Total Asset Debt
Before Funding 71% 39,475 28,186
After Funding 70% 49,130 34,535

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Matco Foods LTD

Till date
outperf
ormanc
e
against
Price return after listing KSE 100
S Cu A
Time Annu
. m nn
Listing since 30 365 Till date alized
N Company ul ua
date listed days days (Cumulative) till
o ati liz
(yrs.) date
. ve ed
CHOOSE ANY 5 COMPANIES FROM FOLLOWING 11 COMPANIES:

2 Feb 2018 4 years 2 28.6% 18.61 118 20.44% 2%

Matco motns % .4% 19.97%
Foods

Company Profile:
Subsidiaries:
The Company has incorporated another subsidiary Matco Marketing (Private)
Limited through 100% ownership.

Management CEO or Chairman or both:

CHAIRMAN: MR. JAWED ALI GHORI

 Jawed Ali Ghori completed his Diploma in Associate Engineering in 1968 and a
BSc. In Economics and Political Science from University of Karachi in 1971.After graduation,
he joined the family business and completed several government and semi-government
projects. As the Managing Director of Matco Foods, he has over 40 years of experience in
rice processing, establishment of rice industries and worldwide rice exports.

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CEO: MR, KHALID SARFARAZ GHORI

Khalid Ghori graduated from University of Karachi in 1981 and pursued an article ship
from ICAP (Institute of Chartered Accountants of Pakistan) Karachi between 1981 and 1984.
Between 1986 and 1989, he was in charge of Jawed Rice Mills in Larkana. In 1990, when
Matco Rice Processing was being set up in Karachi. With experience of over 30 years in the
purchase and processing of rice, Khalid Ghori is rightly dubbed the “guru of rice buyers in
Pakistan.” He utilizes his vast experience in assessing the qualities of Agri-products and pays
special attention to the entire procurement and production process.

Revenue model:
What they do:

Matco Foods Limited is a leading Food Processing & Export Company in South-Asia,
established in 1964. They provide packed consumer foods products that offer
convenience, and supply quality ingredients to the pharmaceutical and confectionery
industries. Their products include basmati rice, rice glucose, rice protein, Himalayan
pink salt, spices, dessert mixes and more. As the largest basmati rice exporter from
Pakistan, they have over 50 years of experience in the rice industry, and more than
150 corporate customers, with their flagship brand “Falak” available in more than 65
countries worldwide.

Revenue Model:

The company essentially has three business segments: 1) Rice, 2) Rice Glucose and Protein
division and 3) NPD. It operates five rice processing and milling plants with rice production
capacity of 94,290MT per annum of the Karachi plant, and rice processing capacity of
40,410MT per annum of the Sadhoke plant. On the other hand, production capacity of rice
gulucose and protein stood at 30,000MT and 3,000MT respectively.

During FY20, the company reported sales revenue of PKR 11.29Bn during the period as
against PKR 7.86Bn, up 44% YoY. The improvement in revenue was mainly on the back of
higher sales volume recorded in FY20 at 57,796MT (↑36% YoY).

Private label rice contributed around 85% to the total revenue, whereas branded rice
contributed 15% to the total revenue. Within the rice segment, basmati rice contributed
around 90% to the total revenue.

Cost model: Major cost driver

Main cost drivers are domestic paddy / raw rice prices, utilities, wages and logistics. Company has
incurred major capital expenditures for paddy storage, drying and processing as well set

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up a Rice Glucose plant. Depreciation of capital expenditure is also a major cost driver. Basmati rice
is aged and matured before exporting, and the carrying cost of inventory which includes financial
charges on short term loans, insurance, and warehousing costs are also a major cost driver. Direct
taxes, provincial sales tax levies and delays in sales tax refunds are also another major cost element.

Rating: Long term and Short term

LONG TERM: BBB+
SHORT TERM: A-2

(Company have High ability to fulfill financial obligations, but may be affected by adverse

economic conditions and changes.)

IPO Funding:
Purpose:
Matco Foods Limited, one of the leading basmati rice exporters in Pakistan, has said the money it
raised through an initial public offering (IPO) will be mostly used for expansion of its high-margin
business to allow the company to generate more profit in coming years.

How will generate proceeds to refund

Refund money must be paid by check drawn on applicant’s own bank account or pay order /
bank draft payable to one of the Bankers.

Debt to Total Asset ratio (before / after funding). It means you will show only two
numbers
Before funding: 61.8%
After funding: 54.70%

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COMPANY OVERVIEW
Ittefaq Iron Industries Limited (Formerly Ittefaq Sons Private Limited) was founded
on February 20, 2004, and on January 5, 2017, it was turned into a public unquoted
company. On February 9, 2017, the company changed its name from Ittefaq Sons (Private)
Limited to Ittefaq Iron Industries Limited. The company's main business is the production of
iron bars and girders. Growth has been proportional to the industry's needs. Currently, we
have a 400,000MT capacity. Our long-term goals include expanding our present capacity to
1,000,000 MTA. With around 519 employees, there are 31,312,500 ordinary shares worth
Rs.10.35 each.

PROFILE OF DIRECTORS
Mr. Usman Javed, Chief Executive Officer / Director
Mr. Usman is the son of Mian Muhammad Javed Shafi, one of the country's most
prominent businesspeople with a unique vision and energetic leadership style. Mr. Usman
served on the boards of directors of Kashmir Poultry Breeders (Pvt.) Limited, Ittefaq Sugar
Mills Ltd., and Kashmir Feeds Ltd. Mr. Usman is a key role in the Company's strategic
decisions, and he has guided it to become one of the industry's leading companies in the
steel sector. He holds an MBA from the University of Utah in the United States.
Mr. Mian Muhammad Pervaiz Shafi, Director
Mr. Pervaiz has 40 years of expertise in the iron and steel sector and is regarded as
one of the steel industry's most seasoned entrepreneurs. He has also worked with Ittefaq
Sugar and Kashmir Sugar Mills Ltd. as a director. The Company intends to reach new heights
under his leadership and to flourish even more in the steel industry. In addition, Mr. Pervaiz
is a member of the Company's audit committee.

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Name Age Since Title

Muhammad Pervaiz
- - Executive Chairman
Shafi

CEO & Executive

Shahzad Javed - 2018
Director

Non Executive
Tayyab Ali - 2021
Director

Non Executive
Sobia Irshad - 2021
Director

Muhammad Independent
- -
Mubashir Iqbal Director

Non Executive
Wajeeha Shahzad - -
Director

Independent
Khurram Jamil - -
Director

COMPANY PROFILE
Ittefaq has always been associated with high-quality structural steel in Pakistan.
Ittefaq Steel employs 1000 people whose main mission is to look after the company's
customers. We're here to assist you. This was made possible by being the world's safest,
highest-quality, and most productive steel goods company. Pakistan is a South Asian
country. While remaining cultural and environmental stewards, we aspire to do so. We live
and work in neighbourhoods. Because we're all working together, we're succeeding. Client
satisfaction, product creation, research, and development are all priorities for the
organisation. assurance of quality However, the primary concern has always been to place a
significant emphasis on investment. It invests in its national manpower as the company's
true capital.
The company's long-term investment in a combination of innovative technologies
and a highly trained and motivated workforce has been critical in advancing us to this

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position. We are now leading the way in heavy industry by offering structural and alloy steel
in the form of billets and bars in all types of industrial and residential sectors, thanks to
ALLAH's blessing.

PRODUCT PROFILE
Ittefq Steel is Pakistan's leading steel rolling factory, capable of producing high-
quality commodities that exceed DIN and ASTM requirements. The firm has established a
reputation as a trailblazer in the steel sector. Our cutting-edge rolling equipment can
produce structural steel to fulfil your strict specifications for critical applications (with tight
tolerances and the required mechanical properties). Because of its extremely rapid and
flexible production capability in delivering trailor built solutions, Ittefaq Steel has been a
chosen structural steel supplier to significant customers in the region. We can also shorten
the time it takes to produce consistent international quality structural steel angels flat bars,
channels, round, and girders in a variety of sizes.
Revenue model: What company do? How many revenue streams? How revenue
generated?
Ittefaq iron produces and sells multiple products and generates income through its
selling
They are as following;
1) DEFORMED BARS
2) GIRDER, T-IRON, I & BEAM, CHANNEL & ANGEL
3) STEEL BILLETS

Production facilitation includes

1) STEEL BILLETS
2) LADLE REFINING FURNACES
3) AOD CONVERTER
4) CONTINUOUS CASTING
5) BAR ROLLING MILL
6) STRUCTURAL MILL

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Key Revenue Driver:

The segment's margins improved in FY21, with the gross margin increasing to 20%
from 9% in FY20.
Meanwhile, net margins increased from 6 percent in FY20 to 16 percent in FY21. The rise
was fueled by increased demand, which was reflected in higher export levels and lower
borrowing costs at the time.
During FY 16, the Company generated sales of PKR 3,917 million by using about PKR 1,907
million in working capital, and the IPO proceeds would be used to generate more sales
through supply to various projects.Cost model: Major cost driver
The category's direct costs are almost entirely made up of raw materials. Copper and
aluminium, either in their native state or as scrap, are used as raw materials.
Raw materials, salaries, fuel and electricity, vehicle repair and maintenance, insurance,
travel, and depreciation are all factors to consider.
Risk of Interest Rates
An increase in interest rates would increase the Company's financial costs because
the Company has both short and long term debt to fulfil its near and long term financing
needs. An increase in finance costs would hurt the company's profitability.
Benefits for Employees
Actuarial valuations (projected unit credit technique) are performed by independent
actuaries to determine the cost of a defined benefit retirement plan (gratuity). The actuarial
valuation method includes making assumptions about discount rates, future pay increases,
and death rates. All assumptions are evaluated at each reporting date.
Inventories
The Company assesses the net realisable value of stock in trade and storage, as well as
spare parts, to assess any deterioration in the respective carrying values. To arrive at the
net realisable value, the estimated selling price in the normal course of business is reduced
from the estimated cost to complete the transaction.

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IPO funding
OFFER FOR AN INITIAL PURCHASE (IPO) During the year, the company made a
number of corporate activities, including increasing the authorised share capital from Rs
1000,000,000 to Rs 3000,000,000. The share denominations range from Rs.100 to Rs.10/.
Ittefaq Sons Pvt Ltd was renamed Ittefaq Iron Industries Pvt Ltd, and the company's status
was changed from private to public listed. The Initial Public Offering (IPO) was launched in
the last week of May 2017, and the company was officially listed on the Pakistan Stock
Exchange (PSX) at the end of June 2017.
The Issue consists of 41,750,000 Ordinary Shares of PKR 10/- each, representing
31.82 percent of the Company's total post-IPO paid-up capital.
The Company will be able to manage larger levels of inventory requirements as a result of
this equity infusion, allowing it to increase re-bar sales to various on-going and upcoming
public-sector building projects.
To fulfil the Company's growing demand for completed products, the IPO proceeds
will be utilised to purchase raw materials (such as scrap and alloys) and manage production
expenses linked to transforming those raw materials into finished items for onward sale to
various clients.

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With PKR 351 million in equity generated through an IPO, the Company would be
able to procure roughly 9,500 MT of scrap and needed alloys at current market values.
Utilization of the Excess Amount
Any additional monies received by the Company would be utilised for one or more
of the following: 1. Short-term borrowings must be repaid. 2. Modification and redesigning
of the Company's plant and machinery, including the Girder Mill, subject to the economic
viability of any such modification or redesigning. 3. Any additional action connected to the
Company's activities that the board of directors deems essential.
Tax Credit for Investment in IPO
A resident person other than a company is entitled to a tax credit under Section 62
of the Income Tax Ordinance, 2001, for the cost of acquiring new shares offered to the
public by a public company listed on a stock exchange in Pakistan during the tax year,
provided the resident person is the original allottee of the shares or the shares are acquired
from the Privatization Commission of Pakistan.

Competitors
 Pakistan Steel Mill
 Mughal Steel
 Aisha Steel
 Amrili Steel
 Agha Steel

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Sales

Debt to asset ratio

Debt to Total Asset ratio (before / after funding). It can be seen that the bedt to
asset ratio has decreased after the IPO funding from 39% to 34%. But the amount of asset
holding has increased significantly, from 3950 Million to 6050 Million which states that the
company has bought huge machinery for furher sales and expansion and it has paid a very
little amount in debt paying, settling total of 5% of the debt after IPO.

Debt Assets
Before funding 39% 3,950
After Funding 34% 6,050

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RETURN
The table below represents the total return earned by the shareholder. At the initial point
this stock outperformed and made records in the IPO. This stock was initially set at a price
of 12 rupees but soon after the IPO the price closed to 30 rupees which is more then the
double of the initial aount of IPO, this clearly states the success of the IPO. But after its
success it faced huge declines after or in the era of COVID19, the cumulative returns for 30
days is 17% and for 365 days is 57%. Its cumulative return till now is negative 40.25 percent
and annualized till date is negative 9.81% .

S.No Listing Time since listed

Company
. date (yrs.)
Ittefaq
1 Iron 5-Jan-17 5 years

KSE 100 Difference

Till date
30 365 Annualized till Cumulativ Annualiz Cumulativ Annualiz
days days (Cumulativ date e ed e ed
 
e)
-
17.02 57.50
% % -40.25% -9.81% -8.45% -1.75% -31.80% -8.05%

Company
A Prices
5-Jan-17 27.65
31-Dec-
21 16.52

  KSE 100
48,713.0
5-Jan-17 0
31-Dec- 44,596.0
21 7
   
Years 4.99

Conclusion

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