PACRA Maintains Entity Ratings of Islamabad Farms - Press Release issued by The Pakistan Credit Rating Agency Limited.

Lahore -- October 31, 2022 (PPI-OT)

Following is the text of press release issued by The Pakistan Credit Rating Agency Limited (PACRA)

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The poultry industry is one of the largest agro-based segments in Pakistan, comprising domestic and commercial poultry. The industry has posted annual growth of ~ 7%. Pakistan is sufficient in poultry meat and egg production. However, per capita protein consumption remains low (11th) when compared to the world's average. The industry generates an estimated annual revenue of ~PKR 1,533bln from local and export sales during FY22, a YoY increase of ~29%. Export revenue is ~USD 3.5mln to ~4mln, annually. The increase is majorly price driven. Subsequently, prices of poultry products, especially day-old chicks, witnessed a hike of ~ 10% and benefited the players involved in the poultry allied chain.

Increasing demand, and hence, prices eased down the liquidity problems of the industry. Demand for poultry products is likely to stay favourable for the industry players. The FY22 floods have damaged livestock and crops. Overall, ~31% of livestock holders have lost animal/poultry due to floods. Around 54% of affected households reportedly lost fodder/feed stored for their livestock. More than ~50% of animal shelters/sheds have been damaged. Consequently, livestock holders are facing a severe shortage of fodder/feed for livestock. This is expected to lead to price escalation during FY23.

The ratings reflect Islamabad Farms's ('the Business') developing position in the poultry industry and the sponsor's adequate acumen across the integrated poultry supply chain. The Business revenue is concentrated toward day-old chicks and posted a volumetric decline...