Nishat Mills Limited (NML) reported earnings per share of PKR 14.52 for FY25, compared to earnings per share of PKR 22.38 in FY24. Furthermore, in 1QFY26, the company reported earnings per share of PKR 3.99, compared to earnings per share of PKR 6.64 in the same period last year (SPLY). The company has further capital expenditure planned, including work-in-progress for an additional 4 MW of solar energy, as well as infrastructure investments of 45 TPH biomass steam boiler and battery storage systems.
Management also highlighted continued investment in Nishat Sutas Dairy Limited, where PKR 3.9 billion has been deployed out of the approved PKR 5 billion. Pakistan continues to face a structural cotton deficit of 4–5 million bales annually. Management noted that gross margins would improve meaningfully if electricity and energy costs normalize, with current power costs hovering around PKR 35–38 per unit.
Denim and Technical Textiles were identified as key value drivers for future profitability. Investments in these segments are designed to hedge margin dilution risks, diversify the product mix, and reduce revenue seasonality. The technical textiles segment, in particular, offers significant profitability potential, targeting European and other non conventional markets where Pakistan currently lacks manufacturing capability. Freight costs increased by approximately PKR 920 million due to disruptions in trade through the Red Sea.
The company also plans to expand open-end yarn production through the addition of 3,000 rotors. The company’s fuel mix comprises coal and biomass (10%), solar energy (7%), and a remaining 83% sourced from a combination of WAPDA, furnace oil, and gas depending on cost efficiency.
Total energy requirements stand at around 50 MW. On the raw material side, the cotton mix consists of roughly 30% imported cotton and 70% local procurement, which is expected to continue until February. Denim, being a premium category, typically requires 18–24 months to scale a meaningful customer base. Current denim utilization is estimated at 60–70% of capacity.
Important Disclosures
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