Strategic Audit Report of Nishat Mills

1. STRATEGIC AUDIT
REPORT
Presented By
Sohaib Manzoor

2. Strategic Audit Report of Nishat Mills

3. INTRODUCTION TO
COMPANY

4. Company’s Profile & History
 Flagship company of Nishat Group
 Established in 1951
 Company has modern textile dyeing & processing units
Operational & Financial Performance
 In 1961 listed on Karachi Stock Exchange
 In 1989 listed on Lahore Stock Exchange
 In 1992 listed on Islamabad Stock Exchange
 Acquired assets of Nishat Tek Ltd & Nishat Fabrics in 1996
 Total Exports for the year 2016 was Rs. 35.931 billion

5. Company’s Mission
To provide quality products to customers and explore new
markets to promote/expand sales of the Company through
good governance.
Company’s Vision
To transform the Company into a modern and dynamic yarn,
cloth and processed cloth and finished product
manufacturing Company that is fully equipped to play a
meaningful role on sustainable basis in the economy of
Pakistan.

6. Code of Conduct
 Code of conduct for employees was approved by Board of
Directors on June 15,2012
 Code is a source of guidance for conduct and applies to all
employees
 Any contravention of code of conduct will be investigated
Auditors & Legal Advisor of Company
 Riaz Ahmad & Company
Chartered Accountants
 Mr. M. Aurangzeb Khan, Advocate

7. CORPORATE
GOVERNANCE

8. Board of Directors
■ Mian Umer Mansha (CEO)
■ Mian Hassan Mansha (Chairman)
■ Mr. Khalid Qadeer Qureshi
■ Mr. Ghazanfar Hussain Mirza
■ Syed Zahid Hussain
■ Ms. Nabiha Shahnawaz Cheema
■ Mr Maqsood Ahmad

9. HR & R Committee
■ Mian Hassan Mansha (Chairman)
■ Mian Umer Mansha
■ Mr. Khalid Qadeer Qureshi
■ Ms. Nabiha Shahnawaz Cheema
Company Secretary
Mr. Khalid Mehmood Chohan

10. Audit Committee
■ Mr. Khalid Qadeer Qureshi (Chairman)
■ Syed Zahid Hussain
■ Ms. Nabiha Shahnawaz Cheema
Chief Financial Officer
Badar Ul Hassan

11. FINANCIAL POSITION
& PERFORMANCE

12. Financial Highlights 2017-16
Rupees in thousand Rupees in thousand
2017 2016
Authorized Share Capital 11,000,000 11,000,000
Total Equity 88,762,796 82,155,155
Total Liabilities 29,963.115 24,444,064
Total Assets 118,725,911 106,599,219
Gross Profit 5,379,838 6,239,391
Profit After Taxation 4,262,342 4,923,038
Earnings Per Share 12.12 14.00
Comprehensive Income
for the year
8,365,640 7,594,531
Net Cash From Financing
Activities
3,200,620 3,377,513

13. Financial Highlights 2017-12
6 years at a glance
Rupees in
Thousand
2017 2016 2015 2014 2013 2012
Total Assets 118,725,911 106,599,219 101,140,000 97,048,577 80,634,594 56,626,383
Total Equity
&
Liabilities
118,725,911 106,599,219 101,140,000 97,048,577 80,634,594 56,626,383
Sales 49,247,657 47,999,179 51,200,223 54,444,091 52,426,030 44,924,101
Gross Profit 5,379,838 6,239,391 6,046,784 7,863,774 9,044,485 6,789,191
Profit
before Tax
5,020,342 5,725,038 4,389,925 5,975,552 6,356,853 4,081,567
Profit after
Tax
4,262,342 4,923,038 3,911,925 5,512,552 5,846,853 3,528,567

14. COMPANY’S
PRODUCTS &
SERVICES

15. Product’s & Services
■ Spinning
■ Yarn Dyeing
■ Weaving
■ Processing
■ Home Textile
■ Garments

16.  Spinning
Nishat Mills Spinning Division has over 227,640 spindles,
which are operationally organized into 8 spinning units. The
entire machinery is from world-renowned manufactures. All
yarns made at Nishat are Ring Spun suitable for both knitting
and weaving.

17.  Yarn Dyeing
Nishat Yarn Dyeing is one of the latest exhaust dyeing units
in Pakistan having installed production capacity of 5.0 tons
per day. They are processing yarn and sewing thread in
package. Also, they have set up facility for Beam Dyeing
which is first of its kind in Pakistan.

18.  Weaving
Nishat Mills Weaving division has 805 modern Air Jet looms
which produce approximate 11.3 million meters of fabric per
month and makes it the largest weaving facility of Pakistan
catering to home textile and apparel fabrics.

19.  Processing
Their fabric processing facility is one of the largest and most
modern facilities of Pakistan. With an array of custom-made
machinery, it has the capacity to produce 104 million meters
of fabric per annum. It is specially designed to handle heavy
weight fabrics like twills, drills, canvases / poplins, fabrics
with minimum tension such as stretch fabrics and all high
density weaves.

20.  Home Textile
With an array of 939 modern new generation sewing
machines, the Home Textile Division consists of 2 stitching
facilities. The two facilities combined have an average
production capacity of approximately 24 million meters per
annum. The product line is customized to manufacture
products of various styles and sizes according to the
requirements of their customers, wholesalers, retailers and
contract textile business.

21.  Garments
Nishat Mills Limited has state of art garment manufacturing
facility both for men and women. The Apparel division has
deployed 1767 high end sewing machines such as Vibe Mac,
Juki, Mitsubishi and Brother. The Division has the capacity
to produce 7.20 million garments per annum. The
construction of a new garment unit with a capacity of 7.2
million garments per annum is in progress.

22. COMPANY’S
ANALYSIS

23. Competitive Forces of Nishat Mills Ltd
Major Competitors:
■ Crescent Textile Mills
■ Chenab Textile
■ Arzoo Textile Mills Limited
■ Alkaram Textile
■ Sitara Textile
■ Firdous Cloth Mill
■ Kohinoor Textile Mills
■ Amtex Limited
But main competitors of Nishat Mills are:
■ Crescent Textile Mills
■ Chenab Textile

24. SWOT ANALYSIS

25. Strengths
■ Lowest employee turnover
■ Highly experienced professionals
■ Decentralized organizational structure
■ Efficient information system
■ Good financial position
■ Location of plants
■ Highest Capacity of production
■ Highly motivated workforce
■ High quality standards
■ Latest mechanized machinery

26. Weakness
 Less advertising focus
 Imported Machinery
 High production cost
 Centralized decision making
 Less promotional activities

27. Opportunities
■ To increase target market
■ Quality and Guaranteed Fabrics
■ To expand product line
■ International fair trade certificate
■ Increase demand of Pakistani cotton internationally
■ New market segment
■ External relations

28. Threats
■ Political instability
■ Low market share in overseas market
■ Focus more on export oriented
■ Limited retailing outlets
■ Shortage of electricity supply
■ Change in Government policies
■ Increased taxes

29. SO Strategies
■ Designer wear garments for gents.
■ Open retail outlets in gulf.
WO Strategies
■ Concentrate on electronic advertising domestically.
ST Strategies
■ Open retail outlets in suburbs areas.
■ More domestic production.
WT Strategies
■ Advertising internationally.
■ Increase machine handling training for employees.

30. Any Questions?