VIS reaffirms IPAK’s ‘A/A1’ ratings with stable outlook

February 18, 2026 (MLN): VIS Credit Rating Company Limited (VIS) has reaffirmed the credit ratings of International Packaging Films Limited (IPAK) at ‘A/A1’ (Single A/A One).

The medium to long term rating of ‘A’ indicates good credit quality with adequate protection factors, while the short term rating of ‘A1’ shows a strong likelihood of timely repayment of obligations supported by excellent liquidity.

The outlook on the assigned ratings remains Stable. The previous ratings action was declared on December 9, 2024.

IPAK was incorporated as a private limited company on October 2, 2015. It converted to a public limited company on June 11, 2021, and was subsequently listed on the Pakistan Stock Exchange on June 3, 2024.

The company produces and sells flexible packaging materials, including Biaxially Oriented Polypropylene (BOPP) films and related products. Commercial operations began in September 2017.

The ratings show IPAK’s established market position in the BOPP films segment, supported by a diversified customer base and long-standing relationships with leading FMCG players.

Although topline growth has remained subdued, the company’s scale, market presence, operational synergies, and efficiency initiatives are expected to support revenue growth and profitability over the medium term.

Debt servicing capacity is adequate, and the capitalization profile is conservative.

The ratings also account for the medium to high business risk in the packaging sector, characterized by earnings volatility due to reliance on imported raw materials, exposure to global polymer price and exchange rate fluctuations, and intense competition.

The parent company’s financial profile includes significant investments in subsidiaries amounting to approximately Rs14bn to expand overall group capacity.

These investments were funded through a combination of equity, long-term financing, and accumulated profits.

Despite the long-term nature of the funding, short-term liquidity was affected during the expansion phase due to timing differences between capital deployment and realization of associated cash flow benefits.

As subsidiary operations stabilize, improving profitability and cash flow contributions will be important to strengthen the parent’s standalone liquidity and financial metrics.

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