should say ‘Yarn Sales’. What happened? At the start of the 2010s, Ravi Textile Mills fortunes began to dip. As the of problems: “volatile changes in prices of raw materials, disproportionate increase in price of yarn, volatile yarn market, bearish yarn market, increase in energy cost, scheduled and unscheduled extensive load shedding of electricity, and high mark up rates charged by banks.” This resulted in a ‘squeezed liquidity’ position of the company, and the mill was not able to repay its short term borrowings and credit facilities of the company, which expired in June 2011. And so management suspended operations at the mills, while it sorted out compromises with banks. Scraping together some directors’ loans, the company managed to resume operations of the mills in June 2015. This turned out to be very short lived, and it was suspended again in August 2015. It seems that Ravi Textile Mills was facing the full brunt of the crisis in the textile industry. So the company decided to sell its assets. In February 2019, it sold International – all except the vehicles – for Rs300 million. The money from the sale of the assets was then used to repay the company’s liabilities. The company made Rs113.3 million in ‘other’ income in 2019, which allowed it to Rs34.7 million the year prior. In 2020, the company made Rs41.7 million in ‘other’ income, Then, in August 2020, the company decided to lease a cotton ginning factory in unusual move, as a ginning factory is technically a step back in the textile supply chain. of Rs1.6 million was signed, and the factory was handed over to Ravi, just in time for the ginning season that begins in September. According to the latest annual report, after the completion of necessary repair and maintenance, the company started its new operations from September 2020, and heard that magical word: revenue (the company earned Rs25 million in that month). It was meant to be a new chapter for the textile mill. As the company optimistically predicted: “accumulated losses will reduce in near future and current ratio will further improve. and enhance its production facilities.” of events was just a prelude to this change of Mills, a public unlisted company in Lahore. Muhammad Ahmed Raza has more than 30% company. While there is limited information around since 1992, makes bars and billets, and has an annual production capacity of 348,480 stood at Rs512 million (Rs191 million in 2013). - ing in buying a dud of a textile mill, particularly when the steel sector is expected to take off due to the recent construction sector boom? - ter these days. According to A.A. Soomro, seems to be a not so hostile take over as textile operations are turning green domestically and Pakistan might attract more export orders of There are buyers and distressed assets in the sector. Textile players are getting warmed up after a decade.” There is also another, interesting possibility. Ravi Textiles Mills is currently sitting on the PSX’s defaulters list. There is a slim possibility of a reverse merger, in which a private company becomes a public company by acquiring it. Acquiring a non-operational listed company is often easier and less time consum However, that would depend on the split and what those two companies have planned. in an already listed company. EFG Hermes is accumulating shares in Kohinoor Industries T he Kohinoor - the real, actual Kohinoor - is one of the world’s largest cut diamonds, at 105 carats. It is currently sitting in the front display at the Tower of London. How it got there is a well known part of history in the diamond to Queen Victoria. Since then, the governments of India, Pakistan and Afghanistan have all laid claim to the jewel to be returned. We mention this historical anecdote because it is a bit of an old fashioned name. for the start of his business empire. The Saigols were initially farmers District in Punjab. It was Sayeed Saigol who decided to pack up hig bags and make something of himself, setting up a morphed into a rubber shoe factory, called Kohinoor Rubber. Demand for his business soared due to the outbreak of World War coats. Anticipating partition in the 1940s, Sayeed again packed up, and left for Lyallpur (now Faisalabad). WIth his younger 1948 - Kohinoor Textile Mills, under the umbrella company Kohinoor Industries. until their much larger investment: the MERGERS AND ACQUISITIONS
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