Nishat Chunian Limited: Annual Report 2019

ANNUAL REPORT 2019
Nishat Chunian Limited

Nishat (Chunian) Limited 1 2019
2019 2 Nishat (Chunian) Limited
BRIEF PROFILE
2016 Diversification into Retail Business
The Linen Company (TLC)
2015 Diversified into Cinema Business

NC Entertainment Private Limited
2014 46 MW Coal Based Power Plant
2013 Established a subsidiary company in

USA
2013 2 Spinning Mills acquired & a new spin-

ning mill started
2010 IPP commercial operations
2006 Diversified into Home Textiles
2005 Acquisition of 2 spinning Mills & 5th

Spinning Mill Started
2000 2nd Spinning mill started production
1998 Diversified into Weaving
1991 1st Spinning Mill Setup

Contents
Company Information 04
Notice of Annual General Meeting 05
Chairperson’s Review Report 13
Director’s Report 16
Financial Highlights 25
Statement of Compliance with the Code of Corporate Governance 27
Review Report to the Members on Statement of Compliance
with Best Practices of Code of Corporate Governance 29
Independent Auditor’s Report 30
Nishat (Chunian) Limited – Financial Statements
Statement of Financial Position 34

Statement of Profit or Loss 36
Statement of Comprehensive Income 37
Statement of Cash Flows 38
Statement of Changes in Equity 39
Notes to the Financial Statements 40
Pattern of Shareholding 89
Categories of Shareholders 92
Consolidated Financial Statements
Independent Auditor’s Report 94

Statement of Financial Position 98
Statement of Profit or Loss 100
Statement of Comprehensive Income 101
Statement of Cash Flows 102
Statement of Changes in Equity 103
Notes to the Consolidated Financial Statements 104
Forms 166

Company Information
Board of Directors: Bankers to the Company:

Mrs. Farhat Saleeem (Chairperson) Allied Bank Limited
Mr. Shahzad Saleem (Chief Executive) Askari Bank Limited
Mr. Zain Shahzad Al Barka Bank (Pakistan) Limited
Mr. Aftab Ahmad Khan Bank Alfalah Limited
Mr. Muhammad Ali Zeb Bank Al Habib Limited
Mr. Farrukh Ifzal Bank Islami Pakistan Limited
Mr. Shoaib Ahmad Khan (Independent) Dubai Islamic Bank Pakistan Limited
Mr. Muhammad Zahid Khan (Independent) Faysal Bank Limited
Habib Bank Limited
Audit Committee: Habib Metropolitan Bank Limited
Mr. Shoaib Ahmad Khan (Chairman) Industrial and Commercial Bank of China (ICBC)
Mr. Farrukh Ifzal (Member) JS Bank Limited
Mr. Muhammad Ali Zeb (Member) MCB Bank Limited
Meezan Bank Limited
HR & Remuneration Committee: National Bank of Pakistan
Mr. Shoaib Ahmad Khan (Chairman) Pak Kuwait Investment Company (Private) Limited
Mr. Farrukh Ifzal (Member) Standard Chartered Bank Pakistan Limited
Mr. Muhammad Zahid Khan (Member) SAMBA Bank Limited
Soneri Bank Limited
CFO: The Bank of Punjab
Mr. Babar Ali Khan United Bank Limited
MCB Islamic Bank Ltd.
Company Secretary:
Ms. Samina Aslam Auditors:
Riaz Ahmad & Company
Head of Internal Audit: Chartered Accountants
Mr. Ahmad Bilal
Registered & Head Office:
Mills: 31-Q, Gulberg-II,
Spinning 1, 4, 5, 7 & 8 Lahore, Pakistan.
49th Kilometre, Multan Road, Phone : 042-35761730-39
Bhai Pheru, Tehsil Chunian, Fax : 042-35878696-97
District Kasur. Web : www.nishat.net
Dyeing & Printing Share Registrar:

4th Kilometre, Manga Road, Hameed Majeed Associates (Pvt) Limited
Raiwind. 1st Floor, H.M. House
7-Bank Square, Lahore
Spinning 2, 3, 6 & Weaving Ph: 042-37235081-2 Fax: 042-37358817
49th Kilometre, Multan Road,
Kamogal, Tehsil Pattoki,
District Kasur.

Notice of Annual General Meeting
Notice is hereby given that 30th Annual General Meeting of the Shareholders of Nishat (Chunian) Limited (the
“Company”) will be held on 28th October 2019 at 10:30 A.M. at Registered Office, 31-Q, Gulberg – II, Lahore to
transact the following business:
ORDINARY BUSINESS:
1. To confirm the minutes of the last General Meeting held on August 31, 2019.
2. To receive, consider and adopt audited unconsolidated and consolidated financial statements of the Company
for the year ended 30 June 2019 together with Directors’ and Auditors’ reports thereon and Chairman’s
Review.
3. To consider and approve the payment of a final cash dividend @25% (i.e. Rs.2.50 per ordinary share) as
recommended by the Board of Directors. This is in addition to Interim Dividend(s) already paid to Rs.1.50
per ordinary share i.e.15%.
4. To appoint auditors and to fix their remuneration. The members are hereby notified that the Audit Committee
and the Board of Directors have recommended the name of retiring auditors M/s Riaz Ahmad & Company,
Chartered Accountants, for reappointment as auditors of the Company
SPECIAL BUSINESS:
5. To consider and, if deemed fit, pass a Special Resolution, as proposed in the statement of material facts
annexed with this Notice sent to the members, pursuant to the provisions of Section 199 of the Companies
Act, 2017 to authorize investment of PKR 1.00 Billion by way of loans / advances to Nishat Chunian Power
Limited, a subsidiary company.
(Attached to this Notice is a statement of material facts covering the above-mentioned special business and
draft special resolutions, as required under Section 134(3) of the Companies Act, 2017).
By order of the Board

Lahore Samina Aslam
Dated: October 04, 2019 Company Secretary
NOTES:
1. Closure of Share Transfer Books
For attending AGM:

The Share Transfer Books of the Company will remain closed from 21-10-2019 to 28-10-2019 (both days inclusive).
Transfers Physical / CDS received at the share registrar of the Company M/s Hameed Majeed Associates (Pvt)
Ltd., H.M. House, 7-Bank Square, Lahore upto Close of office timings on 19-10-2019 will be treated in time for
the purpose of attending the meeting.
For entitlement of Final Cash Dividend:

The Share Transfer Books of the Company will remain closed from 02-11-2019 to 08-11-2019 (both days inclusive)
for entitlement of 25% Final Cash Dividend i.e. Rs.2.50 per share. Transfers Physical / CDS received at the share
registrar of the Company M/s Hameed Majeed Associates (Pvt) Ltd., H.M. House, 7-Bank Square, Lahore upto
Close of office timings on 01-11-2019 will be treated for above entitlement.
2. Participation in the Annual General Meeting
A member entitled to attend and vote at this meeting may appoint any other member as his/her proxy to attend
and vote on his/her behalf. The instrument appointing proxy must be received at the Registered Office of the
Company duly stamped and signed not later than 48 hours before the meeting.
CDC Account Holders will further have to follow the under mentioned guidelines as laid down in Circular No.1 dated
January 26, 2000 issued by the Securities and Exchange Commission of Pakistan.
A. For Attending the Meeting:

(i) In case of individuals, the account holder or sub-account holder and/or the person whose securities are in
group account and their registration details are uploaded as per the Regulations, shall authenticate his/her
identity by showing his/her original Computerized National Identity Card (CNIC) or original passport at the time
of attending the meeting.
(ii) In case of corporate entity, the Board of Directors’ resolution / power of attorney with specimen signature of
the nominee shall be produced (unless it has been provided earlier) at the time of the meeting.
B. For Appointing Proxies:

(i) In case of individuals, the account holder or sub-account holder and/or the person whose securities are in
group account and their registration details are uploaded as per the Regulations, shall submit the proxy form as
per the above requirement.
(ii) The proxy form shall be witnessed by two persons whose names, addresses and CNIC Numbers shall be
mentioned on the form.
(iii) Attested copies of CNIC or Passport of the beneficial owners and the proxy shall be furnished with the proxy
form.
(iv)The proxy shall produce his / her original CNIC or original Passport at the time of the meeting.
(v) In case of corporate entity, the Board of Directors’ resolution / power of attorney with specimen signature shall
be submitted (unless it has been provided earlier) along with proxy form to the Company.
3. CNIC / NTN Number on Dividend Warrant (Mandatory)
As has already been notified from time to time, the Securities and Exchange Commission of Pakistan (SECP) vide
Notification S.R.O. 19(I)/2014 dated 10th January 2014 read with Notification S.R.O. 831(1)/2012 dated July 5, 2012
required that the Dividend Warrant(s) should also bear the Computerized National Identity Card (CNIC) Number of
the registered shareholder or the authorized person, except in case of minor(s) and corporate shareholder(s).
Henceforth, issuance of dividend warrant(s) will be subject to submission of CNIC (individuals) / NTN (corporate
entities) by shareholders.
4. Deduction of Income Tax from Dividend under Section 150 the Income Tax Ordinance, 2001 (Mandatory)
(i) Pursuant to the provisions of the Finance Act 2019 the rates of deduction of income tax from dividend payments
under the Income Tax Ordinance as follows:
• Filer 15%
• Non-Filer 30%
All shareholders are advised to check their status on Active Taxpayer List (ATL) available on FBR Website and may,
if required, take necessary actions for inclusion of their name in ATL to avail the lower rate of tax deduction.
(ii) Further, according to clarification received from Federal Board of Revenue (FBR), with-holding tax will be

determined separately on ‘Filer/Non-Filer status of Principal shareholder as well as joint-holder (s) based on their
shareholding proportions, in case of joint accounts.
In this regard all shareholders who hold shares jointly are requested to provide shareholding proportions of Principal
shareholder and Joint-holder(s) in respect of shares held by them to our Share Registrar, in writing as follows:
Compa- Folio/CDs Total Principal Shareholder Joint Shareholder

ny Name Account# Shares Name and Shareholding Name and Shareholding
CNIC# Proportion CNIC# Proportion (No.
(No. of Shares) of Shares)
The required information must reach our Share Registrar within 10 days of this notice; otherwise it will be assumed
that the shares are equally held by Principal shareholder and Joint Holder(s).
(iii) For any query/problem/information, the investors may contact our share registrar M/s. Hameed Majeed
Associates (Pvt) Ltd., H.M. House 7-Bank Square, The Mall, Lahore at phone 042-37235081-2 or email at shares@
hmaconsultants.com
(iv) The corporate shareholders having CDC accounts are required to have their National Tax Number (NTN)
updated with their respective participants, whereas corporate physical shareholders should send a copy of their NTN
certificate to our share registrar M/s. Hameed Majeed Associates (Pvt) Ltd. The shareholders while sending NTN or
NTN certificates, as the case may be, must quote company name and their respective folio numbers.
(v) Withholding tax exemption from dividend income, shall only be allowed if copy of valid tax exemption
certificate is made available to our Share Registrar M/s. Hameed Majeed Associates (Pvt) Ltd. upto November 01,
2019
5. Zakat will be deducted from the dividends at source under the Zakat & Usher Laws and will be deposited
within the prescribed period with the relevant authority. Any shareholder who want to claim exemption shall submit
your Zakat declarations under Zakat and Usher Ordinance, 1980 & Rule 4 of Zakat (Deduction & Refund) Rules,
1981 on prescribed Form CZ-50, to our Share Registrar M/s. Hameed Majeed Associates (Pvt) Ltd otherwise no
exemption wil be granted. The Shareholders while sending the Zakat Declarations as the case may be, must quote
company name and their respective Folio Nunmbers / CDC Account Numbers. Zakat Declarations received before
first of Shaaban are entitled.
6. Payment of Cash Dividend Electronically
In accordance with the provisions of section 242 of the Companies Act, 2017, dividend payable in cash shall
only be paid through electronic mode directly into the bank account designated by the entitled shareholders..
All shareholders are requested to provide the details of their bank mandate specifying:
(i) Title of Account:______________________________________
(ii) IBAN number :______________________________________
(iii) Bank Name :______________________________________
(iv) Branch Code, Name & Addresss:_________________________
(V) Signature of Shareholder:_______________________________

To the Company’s Share Registrar M/s Hameed Majeed Associates (Pvt) Ltd. Shareholders who hold shares
with Participants/ Central Depository Company of Pakistan (CDC) are advised to provide the bank mandate
details as mentioned above, to the concerned Participant / CDC.
If they so desires the shareholders have the option to seek the dividend mandate by using the standardized
“Dividend Mandate Form” available on Company’s website http://www.nishat.net.
7. Circulation of Annual reports through Digital Storage

Pursuant to the SECP’s notification S.R.O 471(I)/2016 dated 31st May, 2016, the shareholders of Nishat
(Chunian) Limited in its 27th AGM of the Company had accorded their consent for transmission of annual
reports including audited annual accounts, notices of AGM and other information contained therein of
the Company through a CD/DVD/USB instead of transmitting the same in hard copies. The shareholders
who wish to receive hard copies of the aforesaid documents may send to the Company Secretary / Share
registrar, the standard request form provided in the annual report and is also available on the Company’s
website and the Company will provide the aforesaid documents to the shareholders on demand, free of cost,
within one week of such demand. The shareholders who also intend to receive the annual report including
the notice of meetings via email are requested to provide their written consent on the standard request form
provided in the annual report and also available on the Company’s website. http://www.nishat.net
8. Video Conference Facility
Pursuant to the provisions of the Companies Act, 2017, the shareholders residing in a city other than Lahore,
and holding at least 10% of the total paid up share capital may demand the Company to provide the facility
of video-link for participating in the meeting. The demand for video-link facility shall be received by the Share
Registrar at the address given hereinabove at least 7 days prior to the date of the meeting on the Standard
Form provided in the annual report and also available on the company’s website. http://www.nishat.net
9. Change of Address
Members are requested to notify any change in their addresses immediately. Shareholders are requested
to provide above mentioned information/documents to (i) respective Central Depository System (CDS)
Participants and (ii) in case of physical securities to the Share Registrar of the Company.
10. The Company has placed the audited unconsolidated and consolidated financial statements for the year
ended June 30, 2019 along with Auditors and Directors Reports thereon, Chairman’s Review and notice of
meeting on its website: www.nishat.net

STATEMENT UNDER SECTION 134 (3) OF THE COMPANIES ACT,
2017 REGARDING SPECIAL BUSINESS:
Background Information
Nishat Chunian Power Limited (NCPL) is a public limited company incorporated in the year
2007, formed under the Power Policy 2002 as an Independent Power Producer (IPP). It is a
subsidiary of Nishat Chunian Limited (the “Company”). It is currently listed on Pakistan Stock
Exchange Limited. The principal activity of the company is to build, own, operate and
maintain a fuel fired power station having gross capacity of 200 MW. NCPL has a chronic
problem with its trade debt balances which fluctuate routinely due to delay in payments from
the NTDC. This creates liquidity problems for NCPL due to which it needs funds to meet its
working capital requirements. The management of the Company is proposing to invest its
funds by extending loans/advances of PKR 1.00 Billion to NCPL at the markup rate of 3
month KIBOR plus 200 bps which shall not be less than the KIBOR for the relevant period or
borrowing cost of the Company whichever is higher for a period of one year from the date of
disbursement. Payment of markup shall be on quarterly basis. The purpose of the
investment is to support the operations of subsidiary which provides stable stream of income
for the Company.
Due Diligence
The directors have, as required by the Regulations, carried out the required due diligence for
the proposed investment for which the shareholders’ consent by special resolution set out
below is required under Section 199 of the Companies Act, 2017. The Due Diligence Report
as approved by the Board will be available for inspection of the members in the annual
general meeting.
Interest of the Investee Company, its sponsors and Directors in the Company
As required by Regulation 4(1) of the Regulations 2012 (the “Regulations”), it is declared

that:
1. the investee company, NCPL, holds no shares in Nishat Chunian Limited and has no
interest in the Company except Common Directorship.
2. The sponsors / Directors of the investee company hold the following shares in Nishat
Chunian Limited:
Names No of Shares
Mrs. Farhat Saleem 5,895,838
Mr. Shahzad Saleem 54,860,632
Mrs. Ayesha Shahzad 238,448
Mr. Zain Shahzad 1,035,500
Mr. Farrukh Ifzal 500
Audited Financial Statements of Nishat Chunian Power Limited
As required by Regulation 5 of the Regulations, the latest financial statements of the

Investee Company as at 30 June 2019 and last interim financial statements shall be made
available for the inspection of the members at the Annual General Meeting.
SPECIAL RESOLUTIONS:

It is proposed that the following Resolution be considered and passed as a Special
Resolution, with or without modification:
“RESOLVED that approval of the members of Nishat Chunian Limited (the “Company”) be
and is hereby accorded in terms of Section 199 of the Companies Act, 2017 to make
investment of up to PKR 1.00 Billion (Rupees One Billion Only) from time to time in Nishat
Chunian Power Limited ("NCPL"), a subsidiary of the Company, by way of loans and
advances, as and when required by NCPL, at the rate of 3 months KIBOR + 200 bps
provided that the rate of return shall not be less than KIBOR for the relevant period or
borrowing cost of the investing company, whichever is higher and that such loans and / or
advances shall be repayable within one year from the date of disbursement and as per other
terms and conditions disclosed to the members.
FURTHER RESOLVED that the above said resolution shall be valid for 1 (one) year and
Chief Executive and Company Secretary of the Company be and are hereby singly
empowered and authorized to undertake the decision of said investment as and when
deemed appropriate and necessary in the best interest of the Company and its shareholders
and to take all steps and actions necessary, incidental and ancillary including execution of
any and all documents and agreements as may be required in this regard and to do all acts,
matters, deeds and things as may be necessary or expedient for the purpose of giving effect
to the spirit and intent of the special resolution for making investment from time to time”.
Further Information
As required by the Companies (Investment in Associated Companies or Associated

Undertakings) Regulations, 2012 (the “Regulations”) the following further information is
provided:
Ref. Requirement Information

No.
I Name of associated company Nishat Chunian Power Limited (“NCPL”)
Ii Basis of Relationship NCPL is a subsidiary company.
Iii Earnings / (Loss) per share for the last Year Earning /
three years (Loss) per
share Rs.
2019 9.30
2018 9.27
2017 8.17
Iv Break-up value per share, based on last PKR 39.09
audited financial statements
V Financial position, including main items Audited Financial Statements for the year ended
of statement of financial position and June 30, 2019 showed:
profit and loss account on the basis of Rs. in
its latest financial statements Balance Sheet: Billions
Asset
Fixed Assets 11,497,764
Current Assets 18,072,999
Total Assets 29,570,763
Liabilities
Long term 716,184
Short Term 14,494,409

Total Liabilities 15,210,593
Profit & loss:

Sales 15,021,084
Gross Profit 5,075,633

Gross Profit Ratio 2.96
Net Profit after tax 3,416,558
Net Profit after Tax Ratio 0.23
EPS 9.30
Vi In case of investment in relation to a Not Applicable
project of associated company or
associated undertaking that has not
commenced operations, following
further information, namely
i Description of the project and its Not Applicable
history since conceptualization
ii Starting date and expected date Not Applicable
of completion of work
iii Time by which such project shall Not Applicable
become commercially operational
iv Expected time by which the Not Applicable
project shall start paying return on
investment.
v Funds invested or to be invested Not Applicable
by the promoters, sponsors
associated company or
associated undertaking
distinguishing between cash and
non-cash amounts.
(B) General Disclosures:
(i) Maximum amount of investment to be Up to PKR 1.00 Billion (Rupees One Billion Only).
made
(ii) Purpose, benefits likely to accrue to the The investment is explained in detail in the
investing company and its members background information hereinabove. This will
from such investment and period of support the operations of the subsidiary. The
investment Company will earn income from the investment.
(iii) Sources of funds to be utilized for Internal cash generation
investment and where the investment is
intended to be made using borrowed
funds:
i Justification for investment Not Applicable
through borrowings
ii Detail of collateral, guarantees Not Applicable
provided and assets pledged
for obtaining such funds
iii Cost of benefit analysis Not Applicable
(iv) Salient feature of all agreements No agreement has so far been entered into with
entered or to be entered with its NCPL for the proposed investments. Agreement
associated company or associated will be executed before extending the loan on the
undertaking with regards to proposed basis of the terms and conditions as approved by
investment the shareholders.
(v) Direct or indirect interest of directors, The directors, sponsors, majority shareholders and
sponsors, majority shareholders and their relatives have no interest in this company
their relatives, if any, in the associates except to the extent of their shareholdings, if
company or associated undertaking or any/directorships.

the transaction under consideration: NCPL is not a member of NCL. Its directors are
nominees of NCL.
(vi) In case any investment in associated The shareholders have approved investment of
company or associated undertaking has PKR 3.00 Billion in their meeting held on
already been made, the performance December 26, 2014. The said investment has been
review of such investment including repaid with markup as per terms and conditions
complete information /justification for approved by the shareholders. There is no write
any impairment or write offs offs/impairment.
1(c ) Additional disclosure regarding investment in the form of Working Capital Loan
(i) Category-wise amount of investment PKR 1.00 Billion as loans/advances
(i) average borrowing cost of the investing Average Borrowing Cost 9.84% per annum for the
company, the Karachi inter Bank period ended 30 June 2019.
Offered Rate (KIBOR) for the relevant 3 month KIBOR for the relevant period.
period, rate of return for Shariah
complaint products and rate of return
unfunded facilities, as the case may be,
for the relevant period.
(ii) Rate of interest, mark up, profit, fees or 3 months KIBOR plus 2%
commission etc. to be charged by
investing company
(iii) Particulars of collateral or security to be No security to be obtained as NCPL is a
obtained in relation to the proposed subsidiary.
investment
(iv) If the investment carries conversion Not Applicable
feature i.e. it is convertible into
securities, this fact along with terms and
conditions including conversion formula,
circumstances in which the conversion
may take place and the time when the
conversion may be exercisable
(v) Repayment schedule and terms and Repayment of principal will be made within one
conditions of loans or advances to be year of the approval by the shareholders while
given to the associated company or payment of markup due will be made on monthly
associated undertaking basis

Chairperson’S Review
Nishat Chunian Limited complies with all requirements set out in the Companies Act, 2017 and the listed
companies (code of corporate governance) regulations, 2017 with respect to the composition, procedures
and meetings of the board of directors and its committees. Further as required under the code of corporate
governance, an annual evaluation of the board of directors is carried out to assess their overall performance
and for this purpose, a comprehensive criterion has been developed. The overall assessment is satisfac-
tory based on the following integral elements, which have a direct bearing on the board’s role in achieving
company’s objectives:
- Vision, mission and values: The board members are aligned with the Company’s vision, mission
and values and encourage them. The board also revisits the vision and mission statement frequently.
- Engagement in strategic planning: The board has a clear understanding of the stakeholders (share-
holders, customers, employees, vendors, society at large) whom the Company serves. The board has
a strategic vision of how the organization should evolve over the next three to five years. Further, the
board sets annual goals and targets for the management in all major performance areas.
- Diligence: The board members diligently performed their duties and thoroughly reviewed, dis-
cussed and approved business strategies, corporate objectives, plans, budgets, financial statements
and other reports. It received clear and succinct agendas and supporting written material in sufficient
time prior to board and committee meetings. The board met frequently enough to adequately dis-
charge its responsibilities.
- Monitoring business activities: The board remained updated with respect to achievement of com-
pany’s objectives, goals, strategies and financial performance through regular presentations by the
management, internal and external auditors and other independent consultants. The board provided
appropriate direction and oversight on a timely basis.
- Diversity and mix: The board members effectively bring the diversity to the board and constitute a
mix of independent and non-executive directors. The non-executive and independent directors were
equally involved in important board decisions.
- Governance and control environment: The board has effectively set the tone at the top, by putting in
place a transparent and robust system of governance. This is reflected by setting up an effective con-
trol environment, compliance with best practices of Corporate Governance and by promoting ethical
and fair behavior across the Company.
Mrs. Farhat Saleem

Chairperson
Lahore
Date: October 04, 2019

Growing Ingeniously

Director’S Report
The Directors of your Company have the pleasure consolidated audited financial statements for the
of presenting to you the financial results of your fiscal year ended June 30, 2019.
Company which include both, separate and
Overview
The Company’s operations remained profitable as devaluation of rupee. Management firmly believes
net sales rose to Rs. 39.34 billion in 2019 from that results can be further improved by committing
Rs. 35.56 billion in 2018. The driving force behind to efficient cost management, BMR, better
increase in sales was spinning and home textile tax planning and making prudent investment
divisions, whose sales have increased by 12.5% strategies.
and 15.5% respectively.
On a consolidated basis, the Company achieved
Keeping up with its profitable track record, the gross turnover of PKR 54.98 billion which is 3.7%
Company is declaring a profit after tax of 8.1% of higher as compared to last year’s turnover of PKR
sales as compared to 6.6% last year. The increase 53.03 billion.
in profitability can be attributed to a number of
factors, chief among them are; increased margin
of spinning business, dividend income and
Year at a glance
Revenue: Rs. 39.34 Billion (+10.6%)
Profit from Operations Rs. 5.84 Billion (+41.1%)
Net Profit for the Year Rs. 3.16 Billion (+34.04%)
For the Year Ended
Financial Highlights
2019 2018
Sales (Rs.) 39,337,640,505 35,560,396,444
Gross Profit (Rs.) 4,887,512,561 4,285,466,431
Profit After Taxation (Rs.) 3,167,591,540 2,363,083,847
Gross Profit % 12.4% 12.1%
Profit After Taxation % 8.1% 6.6%
Earnings Per Share (Rs.) 13.19 9.84
Profitability
Revenue earned during this year was Rs. 39.34 respectively. The gross profits and net profits in
billion, up by 10.6% from last year. The spinning this year increased from 12.1% and 6.6% to 12.4%
and home textile divisions contributed significantly and 8.1% respectively over the last year.
towards this increase, by expanding local market
share and capitalizing on currency devaluation
APPROPRIATIONS
The Board of Directors of the Company have
proposed to pay Rs. 2.5 per ordinary share cash
dividend in its meeting held on October 4, 2019.
Investments
Considerable investments were made during the year in different textile segments for capacity
enhancement and improvement in operational efficiency. A summarized overview is given below:
Business Machinery Added Investment
Segment (PKR in million)
• 36.9
Spinning • 6 Drawing Machines 38.6
• Others 78.5
• 1 machine 73.7
Weaving • Others 21.8
• 2 Embroidery machines 27.2

• Others 19.9
Segment Wise Revenue

Spinning still remains the main stream of revenue
generation for the Company, whereas Home
textile division has also shown tremendous growth
in terms of revenue.
Spinning
Spinning division broke all its benchmarks in terms of revenue as
it registered sales of PKR 23.6 billion, up by 12.5% as compared
to last year. Although exports declined by 17% due to ongoing
trade war between China and USA, the 37% increase in domestic
sales was not only able to set off this decline but also resulted
in net increase in revenue by PKR 2.6 billion, however; currency
devaluation remained a major factor in pushing the yarn prices
in local market. Cotton prices remained high as compared to last
year on account of extended rainy season, however the Company
was able to absorb the price increase by transferring the impact of
rise in raw material to its customers.

Weaving
During the year under review, net sales have
decreased by 4% as compared to last year.
However, this decrease is mainly caused in
house sales of greige fabric, which has increased
by almost 1.2 Billion. The withdrawal of duty
drawback has negatively impacted the export of
weaving sector. On the local front the Company
was able to increase sales by 14.7% as compared
to last year.
Home Textiles
During the year under review, total sales have
increased by 15.53% as compared to last year.
Major increase was noted in exports, which have
increased by 15% in 2019 as compared to 2018.
The driving factor in this regard was devaluation of
local currency that rendered local products being
more competitive internationally. Moreover, local
sales of home textile have also increased due
to opening of two new branches of ‘The Linen
Company’ (TLC) in Karachi and Islamabad.

Subsidiary Companies
The Company has also annexed its consolidated of NCPL for the year ended 30 June 2018 has
financial statements along with separate financial been presented separately.
statements in accordance with the requirements
of International Financial Reporting Standards and Nishat Chunian USA Inc. is a foreign subsidiary
Companies Act, 2017. The group results comprise incorporated under the Business Corporation
of financial statements of Nishat (Chunian) Limited Laws of the State of New York. It is a wholly owned
(“the Holding Company”), Nishat Chunian Power subsidiary incorporated with a principle objective
Limited (NCPL), Nishat Chunian USA Inc., NC of liaising with Holding Company’s marketing
Electric Company Limited and NC Entertainment department providing access, information and
Pvt Limited (till 20th Nov). other services relating to USA Market and to
import home textile products and distribute them
Financial Highlights 2019 2018 to local retailers in USA.
(Rupees in million)
NC Electric Company Limited, incorporated
Turnover 54,988 53,033 under the Companies Ordinance, 1984 on 18th
Gross Profit 10,279 9,287 April, 2014, is established with the objective
Profit before taxation 6,114 5,841 of setting up coal-based power plant of gross
Taxation 535 369 capacity of 46 MW. The plant had successfully
Profit after taxation 5,578 5,471 started its commercial operations in last fiscal
Earnings per share (basic & year which helped Nishat (Chunian) Limited
(the holding company) to optimize their fuel and
diluted) – Rupees 16.26 15.84
electricity cost.
Following is a brief description of all subsidiary NC Entertainment Pvt Limited, In order to
companies of Nishat Chunian Limited: concentrate on the core business of the Company,
the board of directors of the Company in their
Nishat Chunian Power Limited, incorporated meeting held on 24 July 2018 and subsequently
under the Companies Ordinance, 1984 on 23 the shareholders of the Company in their Extra
February, 2007, is established with the objective Ordinary General Meeting held on 20 August 2018
of setting up power generation project having approved the sale of NC Entertainment (Private)
gross capacity of 200MW under a 25 year ‘take Limited - wholly owned subsidiary company, to the
or pay’ agreement with National Transmission highest bidder (Mr. Shahmir Yahya, a related party
& Dispatch Company Limited (NTDCL). NCPL at that time). Total agreed consideration received
started its operations on July 21, 2010. The on disposal of investment in subsidiary company
Company has been listed on Karachi, Islamabad was Rupees 322 million.
and Lahore Stock Exchanges (now, Pakistan
Stock Exchange). Nishat (Chunian) Limited
currently owns and controls 51.07% shares of
Nishat Chunian Power Limited. The Directors’
Report giving a commentary on the performance

Future Outlook, Challenges &
opportunities
To diversify its retail network under the Company’s challenges as highlighted by different stakeholders
brand name TLC (The Linen Company) launch of at various occasions.
further outlets are planned in the major cities across
the country. A major outlet was opened in Karachi The interest rates have almost doubled since
during the year, while recently a new outlet has the last year, as a result; the bottom line of all
been opened at Packages mall Lahore. In home businesses have impacted significantly. Further,
textile division, embroidery machines are being it will remain a great challenge for the industry to
added to enhance capacity and reduce production expand its capacities at current interest rates. If
costs and time. The company is fully committed the whole episode of increased interest rates is
to automate the conventional processes to reduce not addressed in short to medium term the policy
dependency on manpower. would be counter productive in the efforts to
increase exports.
We foresee next financial years will be challenging
due to uncertain economic conditions in the country However, the current scenario is not all gloomy
and slowdown in growth of global economies. as the most recent macro indicators have started
Based on the macro indicators since the last year to show optimistic trend, further the decision of
and the economic outlook of the country as issued government to supply energy to export oriented
by various entities including state bank of Pakistan sectors at subsidized rates is commendable and
the future looks far from promising. The withdrawal shows commitment of the administration to boost
of SRO 1125 and resultant imposition of sales tax exports. The management is fully committed to
on entire textile chain has dramatically impacted look for opportunities amid all the uncertainties
the industry, if the promise of timely sales tax and will capitalise if opportunity arise. As one of
refunds is not materialised the export sector will the leading textile company of the country, the
face serious working capital implications. For the Company is in a position to avail and exploit a
time being the export-oriented sector is facing number of opportunities like regionally diversified
technical challenges in processing the sales tax customer base, vertical integration, abundant
refunds, hopefully the government will address the supply of cotton and bulk man power.
Corporate Social Responsibility

Management strongly believes in social welfare Furthermore, the water used at spinning and
and community service, and endeavors to make weaving mills is provided to the local farmers free
it a integral part of our company’s culture. We add of cost. To deal with the issue of ash on sustainable
substantially to the national exchequer through basis the Company is planning to install a brick
the payment of various taxes, duties and levies manufacturing plant that will manufacture bricks
and our export earnings contribute considerably by using residual ash from coal power plant.
in stabilizing the country’s foreign exchange As part of its philanthropic endeavors, the
position as the Company is counted among the company donates to a school which provides
top exporters of the country. quality education to underprivileged at a nominal
We are an equal opportunity employer and are fee. Moreover, the sponsors of the company along
unbiased to gender, class, ethnicity and religion with other philanthropists is in the process of
as we believe in the culture of meritocracy. We setting up a state-of-the art, not for profit, Saleem
provide our employees with a work environment Memorial Trust Hospital (SMTH). This 350-bed
that is healthy, safe and conducive to continuous hospital which is being constructed on 39 kanals
learning. of land will provide subsidized medical treatment
The Company is also investing in ecofriendly to the underprivileged. The partial section of the
technologies by installing advances water hospital would be opened by June 2020.
treatment plants at home textile division.
Risk Management
Taking risk is important to remain competitive also provides principles for overall financial
and ensure sustainable success. The company’s risk management including credit, interest rate
overall risk management program focuses on the risk, currency risk and liquidity risk. As part of
unpredictability factor of the industry, economy risk management, the company has designed
in general and of business in specific and seeks adequate internal controls and standard operating
to minimize the potential adverse effects on the procedures that are communicated to staff via
profitability. Currently the Company is vulnerable various policies and procedural guidelines.
to business risks like fluctuation in raw material These controls are also periodically reviewed by
prices and export demand orders. The company management and internal audit function.
Internal Financial Controls

At Nishat Chunian Limited we have a robust to the management highlighting loopholes and
internal control and risk management system. The suggesting areas of improvement. It is ensured by
risk management and internal control processes the top management that these suggestions are
are designed to safeguard the company’s assets implemented properly and reviewed periodically.
and to appropriately address and/or mitigate The Board is fully aware of its responsibilities
emerging risks being faced by the company. The for establishing and managing an efficient and
company has an internal audit department which effective internal control system. Thus, these
is outsourced to a reputable audit firm which controls are properly implemented and reliance
carries out periodical audits and presents reports can be placed on their functionality.
Environmental Impacts
The company regularly takes initiatives towards reviewing and implementing the proposals made
the improvement of environment and well-being of by the government in respect of environmental
society. protection. The company has also installed caustic
recovery plant to recover caustic from waste water.
Energy Conservation We also use ecofriendly dyes & chemicals that
Apart from making efforts to generate energy from have less pollution load over our waste streams.
efficient sources, the company is also engaged in
exploring ways to conserve energy. In this aspect Occupational Safety and Health
we have installed LED lights at our mills and plants We carry out regular health and safety awareness
to save energy, moreover training sessions are programs and occasionally organizes free medical
also conducted for employees to promote energy camps as well. Further, regular fumigation is
conservation. carried out at premises of all manufacturing
facilities by using fogging machines to prevent
Environment Protection diseases like dengue. The Company has also
We have a waste water treatment plant to protect provided firefighting equipment and vehicles at all
the environment from the hazardous impacts of its manufacturing facilities.
of our industrial processes. We are constantly

Statement of Compliance
The requirements of the Code of Corporate complied with, a statement to this effect is annexed
Governance as set out by the Pakistan Stock to the report.
Exchange in its listing regulations have been
adopted by the Company and have been duly
Statement of Value Addition

& Distribution
Rs. In Millions
Wealth Generated
Total Revenue and other income 41,792
Bought in Material and services (32,129)
9,663
Wealth Distribution
To Government & Society
Employee remuneration 2,616

Donation 100
Tax & WPPF 674
To providers of Finance
Finance Cost 2,178
Dividend 1,321
Retained for reinvestment and future growth

Depreciation, amortization and retained profit 2,774
9,663


Corporate Governance
During the year your company remained compliant with the Code of Corporate Governance requirements
except as mentioned above.
Composition of Board of Directors:

The diverse mix of gender, knowledge, expertise and skill sets of the members enhances the effectiveness
of our Board. Our Board composition represents the interests of all categories of shareholders and it
consists of:
Total number of Directors:

- Male 7
- Female 1
Composition
The composition of Board is as follows:
a) Independent Directors: 02 as named hereunder:

i. Mr. Shoaib Ahmad Khan
ii. Mr. Muhammad Zahid Khan
b) Non-Executive Directors: 04 as named hereunder:

i. Mrs. Farhat Saleem (Chairperson)
ii. Mr. Aftab Ahmad Khan
iii. Mr. Muhammad Ali Zeb
iv. Mr. Farrukh Ifzal
c) Executive Director: 02 as named hereunder:

i. Mr. Shahzad Saleem (Chief Executive)
ii. Mr. Zain Shahzad
Board of Directors’ Meetings:

During the year under review four (4) meetings were held. Attendance by each director is as follows:
Name of Directors No. of Meetings

Mrs. Farhat Saleem (Chairperson) 0
Mr. Shahzad Saleem (Chief Executive) 4
Mr. Zain Shahzad 1
Mr. Aftab Ahmad Khan 3
Mr. Farrukh Ifzal 4
Mr. Muhammad Ali Zeb 3
Mr. Shoaib Ahmad Khan 4
Mr. Muhammad Zahid Khan (Appointed on 13-12-2018) 2
Mrs. Sonia Karim (Resigned on 10-10-2018) 1

Director’s Remuneration
The remuneration of Directors and fee for attending Board meeting is determined by an approved policy
in accordance with Companies Act 2017 & the listed Companies (Code of Corporate Governance)
Regulations 2017.
Audit Committee
The audit committee is performing its duties in line with its terms of reference as determined by the
Board of Directors. Composition of the Audit Committee is as follows:
Mr. Shoaib Ahmad Khan Chairman

Mr. Farrukh Ifzal Member
Mr. Muhammad Ali Zeb Member
HR & Remuneration Committee
In compliance with the Code, the Board of Directors of your Company have established a HR & R
Committee. Composition of the HR & R committee is as follows:
Mr. Shoaib Ahmad Khan Chairperson

Mr. Farrukh Ifzal Member
Mr. Muhammad Zahid Khan Member
Pattern of Shareholding
Pattern of shareholding as on June 30, 2019 is annexed.
Acknowledgment
The board places on record its profound gratitude for its valued shareholders, banks, financial institutions
and customers, whose cooperation, continued support and patronage have enabled the company to
strive for constant improvement. During the period under review, relations between the management
and employees remained cordial and we wish to place on record our appreciation for the dedication,
perseverance and diligence of the staff and workers of the company.
For and on behalf of the Board,
________________ _______________
Chief Executive Director

Lahore.
Year 2014 2015 2016 2017 2018 2019
2019
(Rupees in thousand)
25
Net Sales 22,799,758 23,780,455 25,799,122 29,815,994 35,560,396 39,337,641
Gross Profit 1,380,613 1,956,775 2,455,518 2,899,793 4,271,344 4,887,513
Distribuon, Admin and Other Expenses 892,998 940,051 1,003,589 1,148,822 1,259,755 1,496,010
Operang Profit plus Other Income 2,302,894 2,497,253 2,642,648 2,873,374 4,143,471 5,845,942
Finance Cost 1,375,292 1,353,886 1,029,629 1,094,723 1,383,365 2,177,576
Nishat (Chunian) Limited

Net Income 761,297 800,420 1,328,775 1,621,332 2,363,084 3,167,592
Current Assets 14,548,838 14,794,557 15,975,281 18,707,295 24,808,457 29,043,475

Total Assets 25,940,962 26,959,844 28,883,996 34,622,603 39,393,599 43,507,943
Current Liabilies 12,801,084 14,084,317 15,817,604 18,311,946 20,926,883 24,512,069
Total Equity 8,417,596 9,969,626 10,987,197 12,007,975 13,710,449 15,338,438
Cash Flows:
Net Cash generated from /(used in) Operang Acvies (2,457,485) 319,654 (479,208) (649,757) (2,288,612) 197,793
Net Cash generated from/(used in) Invesng Acvies (933,413) 166,018 (374,500) (3,865,054) 666,819 (597,348)
Net Cash generated from /(used in) Financing Acvies 3,149,899 465,557 (67,092) 4,510,693 1,653,688 340,839
Earnings Per Share

Basic 3.80 4.00 5.59 6.75 9.84 13.19
Diluted 3.80 4.00 5.59 6.75 9.84 13.19
FINANCIAL HIGHLIGHTS
Dividends for the year 1.00 1.50 2.50 2.75 4.00 4.00
Dividend Payout Rao 0.26 0.38 0.45 0.41 0.41 0.30
Financial Measures:
ROE (Net Income / Equity) 9.04% 8.88% 12.09% 13.50% 17.24% 20.65%
ROI (Net Income / Assets) 2.9% 3.0% 4.6% 4.7% 6.0% 7.3%
Shareholders' Equity Rao (Equity / Assets) 32% 37% 38% 35% 35% 35%
Net Debt Equity Rao (% age) 56% 30% 19% 35% 35% 23%
Interest Coverage Rao (mes) 1.67 1.84 2.57 2.62 3.00 2.68
P/E rao (Price per share / EPS) 11.16 9.19 6.34 7.60 4.83 2.66
Dividend Yield Rao (Cash dividend / Net Income) 0.26 0.38 0.45 0.41 0.41 0.30
Common Stock
Number of shares outstanding at year end 200,184,630 200,184,630 240,221,556 240,221,556 240,221,556 240,221,556
Break up value 42.05 49.80 45.74 49.99 57.07 63.85
Share price as on 30 June 42.39 36.73 35.42 51.32 47.48 35.02
5.00
Operang Profit plus 4.00
4.00
4.00
Other Income 3.00
(Rupees i n
10,000 2.00 1.50 2.75

mi l lion)
2.50
1.00
5,000 1.00
-
2014 2015 2016 2017 2018 2019
-
2014 2015 2016 2017 2018 2019 Dividends for the year
Total Assets Total Equity

20,000
50,000
(Rupees in million)
(Rupees in million)
40,000 15,000
30,000 10,000
20,000
5,000
10,000
- -
2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019
ROE ROI
7.3%
20.65% 6.0%
17.24%
4.6%
12.09% 4.7%
9.04% 13.50% 2.9%
8.88% 3.0%
2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019
Break up value Net Debt Equity Rao (% age)
63.85 56%
49.80 49.99 35%
42.05 30%
57.07
45.74 35%
23%
19%
2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019

STATEMENT OF COMPLIANCE
with Listed Companies (Code of Corporate Governance) Regulations, 2017
Name of company: Nishat (Chunian) Limited
Year ending: June 30, 2019
The company has complied with the requirements of the Regulations in the following manner:
1. The total number of directors are Eight (8) as elected by the board for this purpose. The board has
per the following: complied with the requirements of Act and the Regula-
tions with respect to frequency, recording and circulat-
a. Male: 7 ing minutes of meeting of board.
b. Female: 1
8. The board of directors have a formal policy and
2. The composition of board is as follows: transparent procedures for remuneration of directors in
accordance with the Act and these Regulations.
a) Independent Directors
Mr. Shoaib Ahmad Khan 9. The Board has arranged Directors’ Training pro-
Mr. Muhammad Zahid Khan gram for the following:

b) Other Non-executive Directors a) Non-executive Directors
Mrs. Farhat Saleem, Chairperson Mr. Farrukh Ifzal
Mr. Muhammad Ali Zeb Mr. Muhammad Ali Zeb
Mr. Aftab Ahmad Khan
Mr. Farrukh Ifzal Following directors are exempted from Directors’ Train-
ing Program and the Company has obtained exemption
c) Executive Directors from SECP:
Mr. Shahzad Saleem, Chief Executive
Mr. Zain Shahzad Executive Director
Mr. Shahzad Saleem, Chief Executive
3. The directors have confirmed that none of them Non-executive Director
is serving as a director on more than five listed compa- Mr. Aftab Ahmad Khan
nies, including this company.
Following director is exempted from Directors’ Training
4. The company has prepared a Code of Conduct Program and the Company is pursuing exemption from
and has ensured that appropriate steps have been tak- SECP:
en to disseminate it throughout the company along with
its supporting policies and procedures. Non-executive Director
Mrs. Farhat Saleem, Chairperson
5. The board has developed a vision/mission
statement, overall corporate strategy and significant 10. The board has approved appointment of CFO,
policies of the company. A complete record of particu- Company Secretary and Head of Internal Audit, includ-
lars of significant policies along with the dates on which ing their remuneration and terms and conditions of em-
they were approved or amended has been maintained. ployment and complied with relevant requirements of
the Regulations.
6. All the powers of the board have been duly ex-
ercised and decisions on relevant matters have been 11. CFO and CEO duly endorsed the financial
taken by board/ shareholders as empowered by the rel- statements before approval of the board.
evant provisions of the Act and these Regulations.
12. The board has formed committees comprising
of members given below:
a) Audit Committee
7. The meetings of the board were presided over Mr. Shoaib Ahmad Khan (Independent Director and
by the Chairman and, in his absence, by a director Chairman of Board’s Audit Committee)
Mr. Farrukh Ifzal (Non-Executive Director and Member
of Board’s Audit Committee) 15. The board has outsourced the internal audit
Mr. Muhammad Ali Zeb (Non-Executive Director and function to M/s KPMG Taseer Hadi & Co., Chartered
Member of Board’s Audit Committee) Accountants who are considered suitably qualified and
experienced for the purpose and are conversant with
b) HR and Remuneration Committee the policies and procedures of the company.
Mr. Shoaib Ahmad Khan (Independent Director and
Chairman of Board’s HR&R Committee) 16. The statutory auditors of the company have
Mr. Muhammad Zahid Khan (Independent Director and confirmed that they have been given a satisfactory rat-
Member of Board’s HR&R Committee) ing under the quality control review program of the ICAP
Mr. Farrukh Ifzal (Non-Executive Director and Member and registered with Audit Oversight Board of Pakistan,
of Board’s HR&R Committee) that they or any of the partners of the firm, their spouses
and minor children do not hold shares of the company
13. The terms of reference of the aforesaid commit- and that the firm and all its partners are in compliance
tees have been formed, documented and advised to the with International Federation of Accountants (IFAC)
committee for compliance. guidelines on code of ethics as adopted by the ICAP.
14. The frequency of meetings (quarterly/half year- 17. The statutory auditors or the persons asso-
ly/ yearly) of the committee were as per following: ciated with them have not been appointed to provide
other services except in accordance with the Act, these
a) Audit Committee: regulations or any other regulatory requirement and the
Four quarterly meetings were held during the financial auditors have confirmed that they have observed IFAC
year ended June 30, 2019 guidelines in this regard.
b) HR and Remuneration Committee 18. We confirm that all other requirements of the
One Meeting of HR and Remuneration Committee was Regulations have been complied with.
held during the financial year ended June 30, 2019.
Mrs. FARHAT SALEEM

Chairperson
Lahore

REVIEW REPORT TO THE MEMBERS
Review Report on the Statement of Compliance contained in Listed Companies
(Code of Corporate Governance) Regulations, 2017
We have reviewed the enclosed Statement of Compli- which causes us to believe that the Statement of Compli-
ance with the Listed Companies (Code of Corporate ance does not appropriately reflect the Company’s com-
Governance) Regulations, 2017 (the Regulations) pre- pliance, in all material respects, with the requirements
pared by the Board of Directors of Nishat (Chunian) Lim- contained in the Regulations as applicable to the Com-
ited (the Company) for the year ended 30 June 2019 in pany for the year ended 30 June 2019.
accordance with the requirements of regulation 40 of the
Regulations.
The responsibility for compliance with the Regulations

is that of the Board of Directors of the Company. Our RIAZ AHMAD & COMPANY
responsibility is to review whether the Statement of Com- Chartered Accountants
pliance reflects the status of the Company’s compliance
with the provisions of the Regulations and report if it does Lahore
not and to highlight any non-compliance with the require- Date: October 04, 2019
ments of the Regulations. A review is limited primarily to
inquiries of the Company’s personnel and review of vari-
ous documents prepared by the Company to comply with
the Regulations.
As a part of our audit of the financial statements we are

required to obtain an understanding of the accounting
and internal control systems sufficient to plan the audit
and develop an effective audit approach. We are not re-
quired to consider whether the Board of Directors’ state-
ment on internal control covers all risks and controls or
to form an opinion on the effectiveness of such internal
controls, the Company’s corporate governance proce-
dures and risks.
The Regulations require the Company to place before

the Audit Committee, and upon recommendation of the
Audit Committee, place before the Board of Directors
for their review and approval, its related party transac-
tions and also ensure compliance with the requirements
of section 208 of the Companies Act, 2017. We are only
required and have ensured compliance of this require-
ment to the extent of the approval of the related party
transactions by the Board of Directors upon recommen-
dation of the Audit Committee. We have not carried out
procedures to assess and determine the Company’s pro-
cess for identification of related parties and that whether
the related party transactions were undertaken at arm’s
length price or not.
Based on our review, nothing has come to our attention

INDEPENDENT AUDITOR’S REPORT
To the members of Nishat (Chunian) Limited
Report on the Audit of the Financial Statements
Opinion
We have audited the annexed financial statements of Nishat (Chunian) Limited (the Company), which comprise the
statement of financial position as at 30 June 2019, and the statement of profit or loss, the statement of comprehen-
sive income, the statement of changes in equity, the statement of cash flows for the year then ended, and notes to the
financial statements, including a summary of significant accounting policies and other explanatory information, and
we state that we have obtained all the information and explanations which, to the best of our knowledge and belief,
were necessary for the purposes of the audit.
In our opinion and to the best of our information and according to the explanations given to us, the statement of fi-
nancial position, the statement of profit or loss, the statement of comprehensive income, the statement of changes in
equity and the statement of cash flows together with the notes forming part thereof conform with the accounting and
reporting standards as applicable in Pakistan and give the information required by the Companies Act, 2017 (XIX of
2017), in the manner so required and respectively give a true and fair view of the state of the Company’s affairs as
at 30 June 2019 and of the profit, other comprehensive income, the changes in equity and its cash flows for the year
then ended.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Statements section of our report. We are independent of the Company in accordance with the International
Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants as adopted by the Institute of
Chartered Accountants of Pakistan (‘the Code’) and we have fulfilled our other ethical responsibilities in accordance
with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these mat-
ters.
Following are the Key audit matters:
Sr. No. Key audit matters How the matter was addressed in our audit
1. Inventory existence and valuation
Inventory as at 30 June 2019 amounted to Rupees
16,473.601 million and represented a material posi- Our procedures over existence and valuation of in-
tion in the statement of financial position, break up ventory included, but were not limited to:
of which is as follows:
• To test the quantity of inventories at all loca-
- Stores, spare parts and loose tools amount- tions, we assessed the corresponding inventory ob-
ing to Rupees 752.354 million servation instructions and participated in inventory
- Stock-in-trade amounting to Rupees counts on sites. Based on samples, we performed
15,721.247 million test counts and compared the quantities counted by
us with the results of the counts of the management.
The business is characterized by high volume se- • For a sample of inventory items, re-per-
rial production and the valuation and existence of in- formed the weighted average cost calculation and

Sr. No. Key audit matters How the matter was addressed in our audit
ventories are significant to the business. Therefore, compared the weighted average cost appearing on
considered as one of the key audit matters. valuation sheets.
• We tested that the ageing report used by
Inventories are stated at lower of cost and net real- management correctly aged inventory items by
izable value. Cost is determined as per accounting agreeing a sample of aged inventory items to the
policy disclosed in Note 2.11 to the financial state- last recorded invoice.
ments. • On a sample basis, we tested the net realiz-
able value of inventory items to recent selling prices
At year end, the valuation of inventory is reviewed and re-performed the calculation of the inventory
by management and the cost of inventory is reduced write down, if any.
where inventory is forecast to be sold below cost. • We assessed the percentage write down
applied to older inventory with reference to historic
Useable stores, spares parts and loose tools and inventory write downs and recoveries on slow mov-
raw materials are valued at weighted average cost, ing inventory.
whereas, costing of work-in-process and finished • In the context of our testing of the calcula-
goods is considered to carry more significant risk as tion, we analysed individual cost components and
the cost of material, labor and manufacturing over- traced them back to the corresponding underlying
heads is allocated on the basis of complex formulas documents. We furthermore challenged changes in
and involves management judgment. unit costs.
• We also made enquires of management,
The determination of whether inventory will be re- including those outside of the finance function, and
alised for a value less than cost requires manage- considered the results of our testing above to de-
ment to exercise judgement and apply assumptions. termine whether any specific write downs were re-
Management undertake the following procedures for quired.
determining the level of write down required:
• Use inventory ageing reports together with

historical trends to estimate the likely future saleabil-
ity of slow moving and older inventory items.
• Perform a line-by-line analysis of remaining
inventory to ensure it is stated at the lower of cost
and net realisable value and a specific write down is
recognized, if required.
For further information on inventory, refer to the fol-

lowing:
- Summary of significant accounting policies,

Inventories note 2.11 to the financial statements.
- Stores, spare parts and loose tools note
15 and stock-in-trade note 16 to the financial state-
ments.
2. Revenue recognition Our procedures included, but were not limited to:
• We obtained an understanding of the pro-
The Company recognized net revenue of Rupees cess relating to recognition of revenue and testing
39,337.641 million for the year ended 30 June 2019. the design, implementation and operating effective-
ness of key internal controls over recording of rev-
We identified recognition of revenue as a key audit enue;
matter because revenue is one of the key perfor- • We compared a sample of revenue trans-
mance indicator of the Company and gives rise to an actions recorded during the year with sales orders,
inherent risk that revenue could be subject to mis- sales invoices, delivery documents and other rel-
statement to meet expectations or targets. evant underlying documents;
• We compared a sample of revenue transac-
For further information, refer to the following: tions recorded around the year-end with the sales
orders, sales invoices, delivery documents and oth-
- Summary of significant accounting policies, er relevant underlying documentation to assess if
Revenue from contracts with customers note 2.18 to the related revenue was recorded in the appropriate
the financial statements. accounting period;

Sr. Key audit matters How the matters were addressed in our audit
No.
- Revenue note 23 to the financial state- • We assessed whether the accounting poli-
ments. cies for revenue recognition complies with the re-
quirements of IFRS 15 ‘Revenue from Contracts
with Customers’; and
• We compared the details of a sample of
journal entries posted to revenue accounts during
the year, which met certain specific risk-based crite-
ria, with the relevant underlying documentation.
We also considered the appropriateness of disclo-

sures in the financial statements.
Information Other than the Financial Statements and Auditor’s Report Thereon
Management is responsible for the other information. The other information comprises the information included in the
annual report, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of as-
surance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our knowl-
edge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed,
we conclude that there is a material misstatement of this other information, we are required to report that fact. We
have nothing to report in this regard.
Responsibilities of Management and Board of Directors for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with
the accounting and reporting standards as applicable in Pakistan and the requirements of Companies Act, 2017 (XIX
of 2017) and for such internal control as management determines is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
Board of directors are responsible for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Rea-
sonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs as applicable in Pakistan will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs as applicable in Pakistan, we exercise professional judgment and main-
tain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresenta-
tions, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Com-
pany’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements
or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence ob-
tained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease
to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
We communicate with the board of directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the board of directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the board of directors, we determine those matters that were of most sig-
nificance in the audit of the financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter
or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report be-
cause the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits
of such communication.
Report on Other Legal and Regulatory Requirements
Based on our audit, we further report that in our opinion:
a) proper books of account have been kept by the Company as required by the Companies Act, 2017 (XIX of
2017);
b) the statement of financial position, the statement of profit or loss, the statement of comprehensive income,
the statement of changes in equity and the statement of cash flows together with the notes thereon have been drawn
up in conformity with the Companies Act, 2017 (XIX of 2017) and are in agreement with the books of account and
returns;
c) investments made, expenditure incurred and guarantees extended during the year were for the purpose of
the Company’s business; and
d) zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980), was deducted by the
Company and deposited in the Central Zakat Fund established under section 7 of that Ordinance.
The engagement partner on the audit resulting in this independent auditor’s report is Syed Mustafa Ali.
RIAZ AHMAD & COMPANY

Chartered Accountants
Lahore
Date: October 04, 2019 Nishat (Chunian) Limited 33 2019
STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2019
2019 2018
Note Rupees Rupees
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorized share capital 3 3,000,000,000 3,000,000,000
Issued, subscribed and paid-up share capital 3 2,402,215,560 2,402,215,560

Reserves 4 12,936,222,882 11,308,233,791
Total equity 15,338,438,442 13,710,449,351
LIABILITIES
NON-CURRENT LIABILITIES
Long term financing 5 3,657,436,300 4,756,266,450
CURRENT LIABILITIES
Trade and other payables 6 2,842,610,390 2,238,596,263

Accrued mark-up 7 431,379,587 211,095,682
Short term borrowings 8 20,091,978,160 17,021,991,856
Current portion of non-current liabilities 9 1,093,798,900 1,416,992,650
Unclaimed dividend 52,301,675 38,206,334
24,512,068,712 20,926,882,785
Total liabilities 28,169,505,012 25,683,149,235
CONTINGENCIES AND COMMITMENTS 10
TOTAL EQUITY AND LIABILITIES 43,507,943,454 39,393,598,586
The annexed notes form an integral part of these financial statements.
_____________________ ______________
CHIEF EXECUTIVE DIRECTOR
STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2019
2019 2018
Note Rupees Rupees
ASSETS
NON-CURRENT ASSETS
Fixed assets 11 11,112,476,842 11,359,643,510
Intangible asset 12 669,454 1,228,590
Long term investments 13 3,309,286,040 3,186,681,200
Long term loans to employees 14 15,916,295 13,940,372
Long term security deposits 26,120,190 23,647,440
14,464,468,821 14,585,141,112
CURRENT ASSETS
Stores, spare parts and loose tools 15 752,354,029 686,743,322

Stock-in-trade 16 15,721,247,262 10,447,356,778
Trade debts 17 6,426,369,277 8,124,577,164
Loans and advances 18 2,361,354,660 1,865,276,632
Short term prepayments 9,339,730 3,453,878
Other receivables 19 3,582,338,309 3,522,638,415
Accrued interest 20 152,055,594 60,317,256
Short term investments 21 20,687,395 21,649,175
Cash and bank balances 22 17,728,377 76,444,854
29,043,474,633 24,808,457,474
TOTAL ASSETS 43,507,943,454 39,393,598,586
____________________________
CHIEF FINANCIAL OFFICER

STATEMENT OF PROFIT OR LOSS
FOR THE YEAR ENDED JUNE 30, 2019
2019 2018
Note Rupees Rupees
REVENUE 23 39,337,640,505 35,560,396,444
COST OF SALES 24 (34,450,127,944) (31,289,052,624)

GROSS PROFIT 4,887,512,561 4,271,343,820
DISTRIBUTION COST 25 (944,021,613) (908,398,202)

ADMINISTRATIVE EXPENSES 26 (278,123,593) (222,242,176)
OTHER EXPENSES 27 (273,865,080) (129,114,178)
(1,496,010,286) (1,259,754,556)
3,391,502,275 3,011,589,264
OTHER INCOME 28 2,454,439,930 1,131,881,730
PROFIT FROM OPERATIONS 5,845,942,205 4,143,470,994
FINANCE COST 29 (2,177,576,149) (1,383,364,854)

PROFIT BEFORE TAXATION 3,668,366,056 2,760,106,140
TAXATION 30 (500,774,516) (397,022,293)
PROFIT AFTER TAXATION 3,167,591,540 2,363,083,847
EARNINGS PER SHARE - BASIC AND DILUTED 31 13.19 9.84
_____________________ ______________ ___________________________

CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

STATEMENT OF COMPREHENSIVE INCOME
2019 2018
Rupees Rupees
OTHER COMPREHENSIVE INCOME
Items that will not be reclassified to profit or loss - -
Items that may be reclassified subsequently to profit or loss - -
Other comprehensive income for the year - -
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 3,167,591,540 2,363,083,847
____________________ _____________ ___________________________


STATEMENT OF CASH FLOWS
2019 2018
Note Rupees Rupees
CASH FLOWS FROM OPERATING ACTIVITIES
Cash generated from / (utilized in) operations 32 2,490,020,970 (674,431,916)
Net increase in long term security deposits (2,472,750) (1,413,000)

Finance cost paid (1,957,292,244) (1,366,506,328)
Income tax paid (329,536,085) (248,139,633)
Net (increase) / decrease in long term loans to employees (2,927,322) 1,879,296
Net cash generated from / (used in) operating activities 197,792,569 (2,288,611,581)
CASH FLOWS FROM INVESTING ACTIVITIES

Capital expenditure on property, plant and equipment (682,912,942) (435,249,966)
Capital expenditure on intangible asset - (257,650)
Proceeds from sale of shares of subsidiary company 322,000,000 -
Proceeds from disposal of operating fixed assets 3,125,264 23,708,387
Loans to subsidiary companies (10,435,298,011) (4,977,239,955)
Repayments of loans from subsidiary companies 9,670,897,136 5,831,045,869
Dividend received from subsidiary company 483,247,075 187,585,820
Interest received 41,593,245 37,226,612
Net cash (used in) / generated from investing activities (597,348,233) 666,819,117
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long term financing - 2,076,300,000
Repayment of long term financing (1,422,023,900) (1,554,703,900)
Short term borrowings - net 3,069,986,304 1,785,205,207
Dividends paid (1,307,123,217) (653,113,350)
Net cash from financing activities 340,839,187 1,653,687,957
Net (decrease) / increase in cash and cash equivalents (58,716,477) 31,895,493
Cash and cash equivalents at the beginning of the year 76,444,854 44,549,361
Cash and cash equivalents at the end of the year 17,728,377 76,444,854
____________________ _______________ ____________________________

STATEMENT OF CHANGES IN EQUITY
CAPITAL RESERVE REVENUE RESERVES

SHARE CAPITAL General Unappropriated TOTAL EQUITY
Share premium Total
reserve profit
- - - - - - - - - - - - - - - - - - - - - - - - - - - Rupees - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Balance as at 30 June 2017 2,402,215,560 600,553,890 1,629,221,278 7,375,984,055 9,005,205,333 12,007,974,783

Transaction with owners:
Final dividend for the year ended 30 June 2017 @ Rupees 2.75 per ordinary share - - - (660,609,279) (660,609,279) (660,609,279)
Profit for the year - - - 2,363,083,847 2,363,083,847 2,363,083,847

Other comprehensive income for the year - - - - - -
Total comprehensive income for the year - - - 2,363,083,847 2,363,083,847 2,363,083,847
Adjustment on adoption of IFRS 9 (Note 2.9) - - - (5,288,510) (5,288,510) (5,288,510)

Adjustment on adoption of IFRS 15 (Note 2.18) - - - (213,095,381) (213,095,381) (213,095,381)
Adjusted total equity as at 01 July 2018 2,402,215,560 600,553,890 1,629,221,278 8,860,074,732 10,489,296,010 13,492,065,460
Transactions with owners:
Final dividend for the year ended 30 June 2018 @ Rupees 4.00 per ordinary share - - - (960,886,224) (960,886,224) (960,886,224)
Interim dividend for the year ended 30 June 2019 @ Rupees 1.50 per ordinary - - - (360,332,334) (360,332,334) (360,332,334)
- - - (1,321,218,558) (1,321,218,558) (1,321,218,558)
Profit for the year - - - 3,167,591,540 3,167,591,540 3,167,591,540

Other comprehensive income for the year - - - - - -
Total comprehensive income for the year - - - 3,167,591,540 3,167,591,540 3,167,591,540
______________________ _____________ _____________________________


39
2019
NOTES TO THE FINANCIAL STATEMENTS
1. THE COMPANY AND ITS OPERATIONS

1.1 Nishat (Chunian) Limited is a public limited company incorporated in Pakistan under the Companies Act, 1913
(Now Companies Act, 2017) and listed on Pakistan Stock Exchange Limited. Its registered office is situated at 31-Q,
Gulberg II, Lahore. The Company is engaged in business of spinning, weaving, dyeing, printing, stitching, processing,
doubling, sizing, buying, selling and otherwise dealing in yarn, fabrics and made-ups made from raw cotton, synthetic
fibre and cloth and to generate, accumulate, distribute, supply and sell electricity.
1.2 Geographical location and addresses of all business units are as follows:
Sr. No. Business units and office Address
Manufacturing units:
1 Spinning Units 1, 4, 5, 7 and 8. 49th Kilometre, Multan Road, Bhai Pheru, Tehsil Chunian,
District Kasur.
2 Spinning Units 2, 3, 6 and Weaving. 49th Kilometre, Multan Road, Kamogal, Tehsil Pattoki, District
Kasur.
3 Dyeing, Printing and Stitching. 4th Kilometre, Manga Road, Raiwind.
4 Office 31-Q, 31-C-Q and 10-N, Gulberg-II, Lahore, Pakistan.
5 Retail stores
6 The Linen Company (TLC) – I Outlet No. 9-10, 2nd Floor Gulberg Galleria Mall, Lahore.
7 The Linen Company (TLC) – II Shop No. 008, 2nd Floor, Packages Mall, Lahore.
8 The Linen Company (TLC) – III Outlet No. 21-22, Lower Ground Floor, WTC Giga Mall, DHA
Phase 2, Islamabad.
9 The Linen Company (TLC) – IV Shop No. 45, 3rd Floor, Centaurus Mall, Islamabad.
10 The Linen Company (TLC) – V Shop No. G-14, Ground Floor Ocean Mall, Clifton, Kara-
chi.
1.3 These financial statements are the separate financial statements of the Company. Consolidated financial state-
ments of the Company are prepared separately. Details of the Company’s investment in subsidiaries are stated in note
13 to these financial statements.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies applied in the preparation of these financial statements are set out below. These
policies have been consistently applied to all years presented, unless otherwise stated:
2.1 Basis of preparation
a) Statement of compliance
These financial statements have been prepared in accordance with the accounting and reporting standards as applica-
ble in Pakistan. The accounting and reporting standards applicable in Pakistan comprise of:
- International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board
(IASB) as notified under the Companies Act, 2017; and
- Provisions of and directives issued under the Companies Act, 2017.
Where provisions of and directives issued under the Companies Act, 2017 differ from the IFRSs, the provisions of and
directives issued under the Companies Act, 2017 have been followed.

b) Accounting convention
These financial statements have been prepared under the historical cost convention except for the certain financial
instruments carried at fair value.
c) Critical accounting estimates and judgments
The preparation of financial statements in conformity with the approved accounting standards requires the use of cer-
tain critical accounting estimates. It also requires the management to exercise its judgment in the process of applying
the Company’s accounting policies. Estimates and judgments are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are believed to be reasonable under the
circumstances. The areas where various assumptions and estimates are significant to the Company’s financial state-
ments or where judgments were exercised in application of accounting policies are as follows:
Financial instruments – fair value
The fair value of financial instruments that are not traded in an active market is determined by using valuation tech-
niques based on assumptions that are dependent on conditions existing at the reporting date.
Useful lives, patterns of economic benefits and impairments
Estimates with respect to residual values and useful lives and pattern of flow of economic benefits are based on the
analysis of the management of the Company. Further, the Company reviews the value of assets for possible impair-
ment on an annual basis. Any change in the estimates in the future might affect the carrying amount of respective item
of property, plant and equipment, with a corresponding effect on the depreciation charge and impairment.
Inventories
Net realizable value of inventories is determined with reference to currently prevailing selling prices less estimated
expenditure to make sales.
Accumulating compensated absences
The provision for accumulating compensated absences is made on the basis of accumulated leave balance on account
of employees.
Income tax
In making the estimates for income tax currently payable by the Company, the management takes into account the
current income tax law and the decisions of appellate authorities on certain issues in the past.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the
lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected
credit loss rate for each group. These assumptions include recent sales experience and historical collection rates.
Impairment of investments in subsidiaries
In making an estimate of recoverable amount of the Company’s investments in subsidiaries, the management consid-
ers future cash flows.
Revenue from contracts with customers involving sale of goods
When recognizing revenue in relation to the sale of goods to customers, the key performance obligation of the Com-
pany is considered to be the point of delivery of the goods to the customer, as this is deemed to be the time that the
customer obtains control of the promised goods and therefore the benefits of unimpeded access.
d) Standards, interpretations and amendments to published approved accounting standards that are ef-
fective in current year and are relevant to the Company
Following standards, interpretations and amendments to published approved accounting standards are mandatory for
the Company’s accounting periods beginning on or after 01 July 2018:
• IFRS 9 ‘Financial Instruments’

• IFRS 15 ‘Revenue from Contracts with Customers’
• IFRS 15 (Amendments), ‘Revenue from Contracts with Customers
• IFRIC 22 ‘Foreign Currency Transactions and Advance Consideration’
• Annual Improvements to IFRSs: 2014 – 2016 Cycle
The Company had to change its accounting policies and make certain adjustments without restating prior year results
following the adoption of IFRS 9 and IFRS 15. These are disclosed in note 2.9 and note 2.18. Most of the other amend-
ments listed above did not have any impact on the amounts recognised in prior periods and are not expected to signifi-
cantly affect the current or future periods.
e) Standards, interpretations and amendments to published approved accounting standards that are not
yet effective but relevant to the Company
Following standards, interpretations and amendments to existing standards have been published and are mandatory
for the Company’s accounting periods beginning on or after 01 July 2019 or later periods:
IFRS 16 ‘Lease’ (effective for annual periods beginning on or after 01 January 2019). IFRS 16 specifies how an entity
will recognize, measure, present and disclose leases. The standard provides a single lessee accounting model, requir-
ing lessees to recognize assets and liabilities for all leases unless the lease term is 12 months or less or the underlying
asset has a low value. Lessors continue to classify leases as operating or finance, with IFRS 16 approach to lessor
accounting substantially unchanged from its predecessor, IAS 17 ‘Leases’. IFRS 16 replaces IAS 17, IFRIC 4 ‘Deter-
mining Whether an Arrangement Contains a Lease’, SIC-15 ‘Operating Leases–Incentives’ and SIC-27 ‘Evaluating the
Substance of Transactions Involving the Legal Form of a Lease’. The management of the Company is in the process
of evaluating the impacts of the aforesaid standard on the Company’s financial statements.
Amendments to IFRS 9 (effective for annual periods beginning on or after 01 January 2019) clarify that for the purpose
of assessing whether a prepayment feature meets the solely payments of principal and interest (‘SPPI’) condition, the
party exercising the option may pay or receive reasonable compensation for the prepayment irrespective of the reason
for prepayment. In other words, prepayment features with negative compensation do not automatically fail SPPI. The
amendments are not likely to have significant impact on the Company’s financial statements.
IAS 28 (Amendments) ‘Investments in Associates and Joint Ventures’ (effective for annual periods beginning on or
after 01 January 2019). The IASB has clarified that IFRS 9, including its impairment requirements, applies to long-term
interests. Furthermore, in applying IFRS 9 to long-term interests, an entity does not take into account adjustments to
their carrying amount required by IAS 28 (i.e., adjustments to the carrying amount of long-term interests arising from
the allocation of losses of the investee or assessment of impairment in accordance with IAS 28). The amendments are
not likely to have significant impact on the Company’s financial statements.
IFRIC 23 ‘Uncertainty over Income Tax Treatments’ (effective for annual periods beginning on or after 01 January
2019). The interpretation addresses the determination of taxable profit (tax loss), tax bases, unused tax losses, unused
tax credits and tax rates, when there is uncertainty over income tax treatments under IAS 12 ‘Income Taxes’. It specifi-
cally considers: whether tax treatments should be considered collectively; assumptions for taxation authorities’ exami-
nations; the determination of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates;
and the effect of changes in facts and circumstances. The interpretation is not expected to have a material impact on
the Company’s financial statements.
Amendments to IFRS 10 ‘Consolidated Financial Statements’ and IAS 28 (deferred indefinitely) to clarify the treatment
of the sale or contribution of assets from an investor to its associates or joint venture, as follows: require full recognition
in the investor’s financial statements of gains and losses arising on the sale or contribution of assets that constitute
a business (as defined in IFRS 3 ‘Business Combinations’); require the partial recognition of gains and losses where
the assets do not constitute a business, i.e. a gain or loss is recognized only to the extent of the unrelated investors’
interests in that associate or joint venture. These requirements apply regardless of the legal form of the transaction,
e.g. whether the sale or contribution of assets occur by an investor transferring shares in a subsidiary that holds the
assets (resulting in loss of control of the subsidiary), or by the direct sale of the assets themselves. The management
of the Company is in the process of evaluating the impacts of the aforesaid amendments on the Company’s financial
statements.
Amendments to IFRS 3 ‘Business Combinations’ (effective for annual periods beginning on or after 01 January 2020).
The International Accounting Standards Board (IASB) has issued ‘Definition of Business’ aimed at resolving the difficul-
ties that arise when an entity determines whether it has acquired a business or a group of assets. The amendments
clarify that to be considered a business, an acquired set of activities and assets must include, at a minimum, an input
and a substantive process that together significantly contribute to the ability to create outputs. The amendments include
an election to use a concentration test. The standard is effective for transactions in the future and therefore would not
have an impact on past financial statements.
Amendments to IAS 1 ‘Presentation of Financial Statements’ and IAS 8 ‘Accounting Policies, Changes in Account-
ing Estimates and Errors’ (effective for annual periods beginning on or after 01 January 2020). The amendments are
intended to make the definition of material in IAS 1 easier to understand and are not intended to alter the underlying
concept of materiality in IFRS. In addition, the IASB has also issued guidance on how to make materiality judgements
when preparing general purpose financial statements in accordance with IFRS.
On 12 December 2017, IASB issued Annual Improvements to IFRSs: 2015 – 2017 Cycle, incorporating amendments
to four IFRSs more specifically in IFRS 3 ‘Business Combinations’, IFRS 11 ‘Joint Arrangements’, IAS 12 ‘Income
Taxes’ and IAS 23 ‘Borrowing Costs’. The amendments are effective for annual periods beginning on or after 01 Janu-
ary 2019. The amendments have no significant impact on the Company’s financial statements and have therefore not
been analyzed in detail.
On 29 March 2018, the International Accounting Standards Board (the IASB) has issued a revised Conceptual Frame-
work. The new Framework: reintroduces the terms stewardship and prudence; introduces a new asset definition that
focuses on rights and a new liability definition that is likely to be broader than the definition it replaces, but does not
change the distinction between a liability and an equity instrument; removes from the asset and liability definitions
references to the expected flow of economic benefits–this lowers the hurdle for identifying the existence of an asset
or liability and puts more emphasis on reflecting uncertainty in measurement; discusses historical cost and current
value measures, and provides some guidance on how the IASB would go about selecting a measurement basis for a
particular asset or liability; states that the primary measure of financial performance is profit or loss, and that only in
exceptional circumstances will the IASB use other comprehensive income and only for income or expenses that arise
from a change in the current value of an asset or liability; and discusses uncertainty, derecognition, unit of account,
the reporting entity and combined financial statements. The Framework is not an IFRS standard and does not override
any standard, so nothing will change in the short term. The revised Framework will be used in future standard-setting
decisions, but no changes will be made to current IFRS. Preparers might also use the Framework to assist them in
developing accounting policies where an issue is not addressed by an IFRS. It is effective for annual periods beginning
on or after 1 January 2020 for preparers that develop an accounting policy based on the Framework
f) Standards and amendments to approved published standards that are not yet effective and not consid-
ered relevant to the Company
There are other standards and amendments to published standards that are mandatory for accounting periods begin-
ning on or after 01 July 2019 but are considered not to be relevant or do not have any significant impact on the Com-
pany’s financial statements and are therefore not detailed in these financial statements.
2.2 Employee benefit
The main features of the schemes operated by the Company for its employees are as follows:
Provident fund
There is an approved contributory provident fund for employees of the Company. Equal monthly contributions are made
both by the employees and the Company to the fund in accordance with the fund rules. The Company’s contributions
to the fund are charged to income currently.
The Company provides for accumulating compensated absences, when the employees render service that increase
their entitlement to future compensated absences.
2.3 Taxation
Current
Provision for current tax is based on the taxable income for the year determined in accordance with the prevailing law
for taxation of income. The charge for current tax is calculated using prevailing tax rates or tax rates expected to apply
to the profit for the year if enacted. The charge for current tax also includes adjustments, where considered necessary,
to provision for tax made in previous years arising from assessments framed during the year for such years.
Deferred
Deferred tax is accounted for using the liability method in respect of all temporary differences arising from differences
between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used
in the computation of the taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary dif-
ferences and deferred tax assets to the extent that it is probable that taxable profits will be available against which the
deductible temporary differences, unused tax losses and tax credits can be utilized.
Deferred tax is calculated at the rates that are expected to apply to the period when the differences reverse based on
tax rates that have been enacted or substantively enacted by the reporting date. Deferred tax is charged or credited in
the statement of profit or loss, except to the extent that it relates to items recognized in other comprehensive income
or directly in equity. In this case, the tax is also recognized in other comprehensive income or directly in equity, respec-
tively.
2.4 Functional and presentation currency
Items included in the financial statements of the Company are measured using the currency of the primary economic
environment in which the Company operates (the functional currency). The financial statements are presented in Pak
Rupees, which is the Company’s functional and presentation currency.
2.5 Foreign currency transactions and translation
All monetary assets and liabilities in foreign currencies are translated into Pak Rupees at exchange rates prevailing at
the reporting date. Transactions in foreign currencies are translated into Pak Rupees at exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and
from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies
are charged or credited to statement of profit or loss. Non-monetary assets and liabilities that are measured in terms of
historical cost in a foreign currency are translated into Pak Rupees at exchange rates prevailing at the date of transac-
tion. Non-monetary assets and liabilities denominated in foreign currency that are stated at fair value are translated into
Pak Rupees at exchange rates prevailing at the date when fair values are determined.
2.6 Property, plant, equipment and depreciation
Property, plant and equipment except freehold land and capital work-in-progress are stated at cost less accumulated
depreciation and any identified impairment loss. Cost in relation to certain property, plant and equipment signifies his-
torical cost, borrowing cost pertaining to erection / construction period of qualifying assets and other directly attributable
cost of bringing the asset to working condition. Freehold land and capital work-in-progress are stated at cost less any
identified impairment loss.

Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the Company and cost of the item
can be measured reliably. All other repair and maintenance costs are charged to income during the period in which
they are incurred.
Depreciation
Depreciation on all operating fixed assets, other than standby generators, is charged to income on the reducing bal-
ance method so as to write off the cost / depreciable amount of the assets over their estimated useful lives at the rates
given in Note 11.1. Depreciation on additions is charged from the month in which the assets are available for use upto
the month prior to disposal. Depreciation on standby generators is charged on the basis of number of hours used. The
assets’ residual values and useful lives are reviewed at each financial year end and adjusted if impact on depreciation
is significant.
Previously, depreciation on standby generators was charged on reducing balance method. However, during the year,
the Company’s management carried out a comprehensive review of the pattern of consumption of economic benefits
of the operating fixed assets. Now, the Company charges depreciation on standby generators on the basis of number
of hours used. Such a change has been accounted for as a change in an accounting estimate in accordance with IAS
8 ‘Accounting Policies, Changes in Accounting Estimates and Errors’.
Had there been no change in the accounting estimate, the profit after taxation for the year ended 30 June 2019 would
have been lower by Rupees 27.846 million and carrying value of operating fixed assets as at that date would have been
lower by the same amount.
De-recognition
An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference
between the net disposal proceeds and carrying amount of the asset) is included in the statement of profit or loss in
the year the asset is derecognized.
2.7 Intangible asset
Intangible assets, which are non-monetary assets without physical substance, are recognized at cost, which comprise
purchase price, non-refundable purchase taxes and other directly attributable expenditures relating to their implemen-
tation and customization. After initial recognition, an intangible asset is carried at cost less accumulated amortization
and impairment losses, if any. Intangible assets are amortized from the month, when these assets are available for use,
using the straight line method, whereby the cost of the intangible asset is amortized over its estimated useful life over
which economic benefits are expected to flow to the Company. The useful life and amortization method are reviewed
and adjusted, if appropriate, at each reporting date.
2.8 Ijarah transactions
Ujrah (lease) payments are recognized as expenses in statement of profit or loss on a straight-line basis over the Ijarah
term unless another systematic basis is representative of the time pattern of the user’s benefit even if the payments
are not on that basis.
2.9 IFRS 9 “Financial instruments”
The Company has adopted IFRS 9 “Financial Instruments” from 01 July 2018. The standard introduced new clas-
sification and measurement models for financial assets. A financial asset shall be measured at amortised cost if it is
held within a business model whose objective is to hold assets in order to collect contractual cash flows which arise
on specified dates and that are solely principal and interest. A debt investment shall be measured at fair value through
other comprehensive income if it is held within a business model whose objective is to both hold assets in order to col-

lect contractual cash flows which arise on specified dates that are solely principal and interest as well as selling the as-
set on the basis of its fair value. All other financial assets are classified and measured at fair value through profit or loss
unless the Company makes an irrevocable election on initial recognition to present gains and losses on equity instru-
ments in other comprehensive income. Despite these requirements, a financial asset may be irrevocably designated as
measured at fair value through profit or loss to reduce the effect of, or eliminate, an accounting mismatch. For financial
liabilities designated at fair value through profit or loss, the standard requires the portion of the change in fair value that
relates to the Company’s own credit risk to be presented in other comprehensive income (unless it would create an
accounting mismatch). New simpler hedge accounting requirements are intended to more closely align the accounting
treatment with the risk management activities of the Company. New impairment requirements use an ‘expected credit
loss’ (‘ECL’) model to recognize an allowance. Impairment is measured using a 12-month ECL method unless the credit
risk on a financial instrument has increased significantly since initial recognition in which case the lifetime ECL method
is adopted. For receivables, a simplified approach to measuring expected credit losses using a lifetime expected loss
allowance is available.
The Company has adopted IFRS 9 without restating the prior year results. Key changes in accounting policies resulting
from application of IFRS 9 are as follows:
i) Recognition of financial instruments
The Company initially recognizes financial assets on the date when they are originated. Financial liabilities are initially
recognized on the trade date when the entity becomes a party to the contractual provisions of the instrument.
ii) Classification and measurement of financial instruments
IFRS 9 largely retains the existing requirements in IAS 39 “Financial Instruments: Recognition and Measurement”
for the classification and measurement of financial liabilities. However, it replaces the previous IAS 39 categories for
financial assets i.e. loans and receivables, fair value through profit or loss (FVTPL), available for sale and held to ma-
turity with the categories such as amortized cost, fair value through profit or loss (FVTPL) and fair value through other
comprehensive income (FVTOCI).
Investments and other financial assets
a) Classification
From 01 July 2018, the Company classifies its financial assets in the following measurement categories:
• those to be measured subsequently at fair value (either through other comprehensive income, or through profit
or loss), and
• those to be measured at amortized cost
The classification depends on the Company’s business model for managing the financial assets and the contractual
terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive in-
come. For investments in debt instruments, this will depend on the business model in which the investment is held. For
investments in equity instruments, this will depend on whether the Company has made an irrevocable election at the
time of initial recognition to account for the equity investment at fair value through other comprehensive income. The
Company reclassifies debt investments when and only when its business model for managing those assets changes.
b) Measurement
At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not
at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset.
Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows

are solely payment of principal and interest.
Debt instruments
Subsequent measurement of debt instruments depends on the Company’s business model for managing the asset and
the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies
its debt instruments:
Amortized cost
Financial assets that are held for collection of contractual cash flows where those cash flows represent solely payments
of principal and interest are measured at amortised cost. Interest income from these financial assets is included in other
income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit
or loss and presented in other income / (other expenses) together with foreign exchange gains and losses. Impairment
losses are presented as separate line item in the statement of profit or loss.
Fair value through other comprehensive income (FVTOCI)
Financial assets that are held for collection of contractual cash flows and for selling the financial assets, where the
assets’ cash flows represent solely payments of principal and interest, are measured at FVTOCI. Movements in the
carrying amount are taken through other comprehensive income, except for the recognition of impairment losses (and
reversal of impairment losses), interest income and foreign exchange gains and losses which are recognised in profit
or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in other compre-
hensive income is reclassified from equity to profit or loss and recognised in other income / (other expenses). Inter-
est income from these financial assets is included in other income using the effective interest rate method. Foreign
exchange gains and losses are presented in other income/ (other expenses) and impairment losses are presented as
separate line item in the statement of profit or loss.
Fair value through profit or loss
Assets that do not meet the criteria for amortised cost or FVTOCI are measured at FVTPL. A gain or loss on a debt in-
strument that is subsequently measured at FVTPL is recognised in profit or loss and presented net within other income
/ (other expenses) in the period in which it arises.
Equity instruments
The Company subsequently measures all equity investments at fair value for financial instruments quoted in an active
market, the fair value corresponds to a market price (level 1). For financial instruments that are not quoted in an active
market, the fair value is determined using valuation techniques including reference to recent arm’s length market trans-
actions or transactions involving financial instruments which are substantially the same (level 2), or discounted cash
flow analysis including, to the greatest possible extent, assumptions consistent with observable market data (level 3).
Where the Company’s management has elected to present fair value gains and losses on equity investments in other
comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss. Impair-
ment losses (and reversal of impairment losses) on equity investments measured at FVTOCI are not reported sepa-
rately from other changes in fair value.
Changes in the fair value of equity investments at fair value through profit or loss are recognised in other income/ (other
expenses) in the statement of profit or loss as applicable.
Dividends from such investments continue to be recognised in profit or loss as other income when the Company’s right
to receive payments is established.

Financial liabilities
a) Classification and measurement
Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL
if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities
at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit
or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method.
Interest expense and foreign exchange gains and losses are recognized in statement of profit or loss. Any gain or loss
on de-recognition is also included in profit or loss.
iii) Impairment of financial assets
From 01 July 2018, the Company assesses on a forward looking basis the expected credit losses associated with its
debt instruments carried at amortised cost and FVTOCI. The impairment methodology applied depends on whether
there has been a significant increase in credit risk.
For trade debts and other receivables, the Company applies the simplified approach permitted by IFRS 9, which re-
quires expected lifetime losses to be recognised from initial recognition of the receivables.
iv) De-recognition
a) Financial assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it
transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and re-
wards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks
and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognized
financial assets that is created or retained by the Company is recognized as a separate asset or liability.
b) Financial liabilities
The Company derecognizes a financial liability (or a part of financial liability) from its statement of financial position
when the obligation specified in the contract is discharged or cancelled or expires.
v) Offsetting of financial instruments
Financial assets and financial liabilities are set off and the net amount is reported in the financial statements when there
is a legal enforceable right to set off and the Company intends either to settle on a net basis or to realize the assets and
to settle the liabilities simultaneously.
vi) Hedge accounting
IFRS 9 requires that hedge accounting relationships are aligned with its risk management objectives and strategy and
to apply a more qualitative and forward-looking approach to assessing hedge effectiveness.
There is no impact of the said change on these financial statements as there is no hedge activity carried on by the
Company during the year ended 30 June 2019.
vii) Impacts of adoption of IFRS 9 on these financial statements as on 01 July 2018
On 01 July 2018, the Company’s management has assessed which business models apply to the financial assets held
by the Company at the date of initial application of IFRS 9 (01 July 2018) and has classified its financial instruments
into appropriate IFRS 9 categories. The main effects resulting from this reclassification are as follows:

Financial assets (01 July 2018)
Trade debts categorized as
Loans and Amortised cost
receivables
- - - - - - - - - - - Rupees - - - - - - - - - -
Opening balance (before reclassification) 8,124,577,164 -
Reclassification of trade debts (8,124,577,164) 8,124,577,164
Recognition of expected credit losses on trade debts - (5,288,510)
Opening balance (after reclassification) - 8,119,288,654
The impact of these changes on the Company’s reserves and equity is as follows:
Reserves and equity (01 July 2018
Effect on un-ap- Effect on total

propriated profit equity
- - - - - - - - - - - Rupees - - - - - - - - - -
Opening balance (before reclassification) 9,078,458,623 13,710,449,351
Adjustment on adoption of IFRS 9 due to recognition of expected life time
credit losses on trade debts (5,288,510) (5,288,510)
Opening balance (after reclassification) 9,073,170,113 13,705,160,841
Reclassifications of financial instruments on adoption of IFRS 9
As on 01 July 2018, the classification and measurement of financial instruments of the Company were as follows:
Measurement category Carrying amounts

Original New Original New Difference
(IAS 39) (IFRS 9) Rupees
Non-current financial
assets
Long term loans to Loans and receiva- Amortised cost 16,813,010 16,813,010 -
employees bles
Long term security Loans and receiva- Amortised cost 23,647,440 23,647,440 -
deposits bles
Current financial as-
sets
Trade debts Loans and receiva- Amortised cost 8,124,577,164 8,119,288,654 (5,288,510)
bles
Loans and advances Loans and receiva- Amortised cost 515,390,587 515,390,587 -
bles
Other receivables Loans and receiva- Amortised cost 340,470,982 340,470,982 -
bles
Accrued interest Loans and receiva- Amortised cost 60,317,256 60,317,256 -
bles
Short term investments Amortised cost Amortised cost 21,649,175 21,649,175 -
Cash and bank bal- Loans and receiva- Amortised cost 76,444,854 76,444,854 -
ances bles
liabilities

Long term financing Amortised cost Amortised cost 4,756,266,450 4,756,266,450 -
Current financial li-
abilities
Trade and other paya- Amortised cost Amortised cost 2,050,238,119 2,050,238,119 -
bles
Accrued mark-up Amortised cost Amortised cost 211,095,682 211,095,682 -
Short term borrowings Amortised cost Amortised cost 17,021,991,856 17,021,991,856 -
Current portion of long Amortised cost Amortised cost 1,416,992,650 1,416,992,650 -
term financing
Unclaimed dividend Amortised cost Amortised cost 38,206,334 38,206,334 -
2.10 Investment in subsidiaries
Investments in subsidiary companies are stated at cost less impairment loss, if any, in accordance with the provisions
of IAS 27 ‘Separate Financial Statements’.
2.11 Inventories
Inventories, except for stock-in-transit and waste stock, are stated at lower of cost and net realizable value. Cost is
determined as follows:
Stores, spare parts and loose tools
Usable stores, spare parts and loose tools are valued principally at weighted average cost, while items considered
obsolete are carried at nil value. Items-in-transit are valued at cost comprising invoice value plus other charges paid
thereon.
Stock-in-trade
Cost of raw materials is measured using the weighted average cost formula.
Cost of work-in-process and finished goods comprise cost of direct material, labour and appropriate manufacturing
overheads. Cost of goods purchased for resale is based on first-in-first-out (FIFO) cost formula.
Materials-in-transit are stated at cost comprising invoice values plus other charges paid thereon. Waste stock is valued
at net realizable value.
Net realizable value signifies the estimated selling price in the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the sale.
2.12 Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses. Trade receivables generally do not include amounts
over due by 365 days.
The Company has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected
loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
2.13 Non-current assets (or disposal groups) held for sale
Non-current assets (or disposal groups) are classified as assets held for sale when their carrying amount is to be re-

covered principally through a sale transaction and a sale is considered highly probable. They are stated at the lower of
carrying amount and fair value less costs to sell.
2.14 Borrowings
Financing and borrowings are initially recognized at fair value of the consideration received, net of transaction costs.
They are subsequently measured at amortized cost using the effective interest method.
2.15 Borrowing cost
Borrowing costs are recognized as expense in the period in which these are incurred except to the extent of borrowing
costs that are directly attributable to the acquisition, construction or production of a qualifying asset. Such borrowing
costs, if any, are capitalized as part of cost of that asset.
2.16 Share capital
Ordinary shares are classified as share capital. Incremental costs directly attributable to the issue of new shares are
shown in equity as a deduction, net of tax.
2.17 Trade and other payables
Liabilities for trade and other amounts payable are initially recognized at fair value, which is normally the transaction
cost.
2.18 Revenue from contracts with customers
The Company has adopted IFRS 15 from 01 July 2018. The standard provides a single comprehensive model for rev-
enue recognition. The core principle of the standard is that an entity shall recognise revenue to depict the transfer of
promised goods or services to customers at an amount that reflects the consideration to which the entity expects to be
entitled in exchange for those goods or services. The standard introduced a new contract-based revenue recognition
model with a measurement approach that is based on an allocation of the transaction price. This is described further in
the accounting policies below. Credit risk is presented separately as an expense rather than adjusted against revenue.
Contracts with customers are presented in Company’s statement of financial position as a contract liability, a contract
asset, or a receivable, depending on the relationship between the Company’s performance and the customer’s pay-
ment. Customer acquisition costs and costs to fulfil a contract can, subject to certain criteria, be capitalised as an asset
and amortised over the contract period.
The Company has adopted IFRS 15 by applying the modified retrospective approach according to which the Company
is not required to restate the prior year results. Key changes in accounting policies resulting from application of IFRS
15 are as follows:
i) Revenue recognition
Revenue is recognised at an amount that reflects the consideration to which the Company is expected to be entitled in
exchange for transferring goods or services to a customer. For each contract with a customer, the Company: identifies
the contract with a customer; identifies the performance obligations in the contract; determines the transaction price
which takes into account estimates of variable consideration and the time value of money; allocates the transaction
price to the separate performance obligations on the basis of the relative stand-alone selling price of each distinct good
or service to be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner
that depicts the transfer to the customer of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as dis-
counts, rebates and refunds, any potential bonuses receivable from the customer and any other contingent events.
Such estimates are determined using either the ‘expected value’ or ‘most likely amount’ method. The measurement of
variable consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it
is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur. The meas-

urement constraint continues until the uncertainty associated with the variable consideration is subsequently resolved.
Amounts received that are subject to the constraining principle are initially recognised as deferred revenue in the form
of a separate refund liability.
Sale of goods
Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the goods,
which is generally at the time of delivery.
Rendering of services
Revenue from a contract to provide services is recognised over time as the services are rendered based on either a
fixed price or an hourly rate.
Interest
Interest income is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective inter-
est rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial
asset to the net carrying amount of the financial asset.
Dividend
Dividend on equity investments is recognized when right to receive the dividend is established.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
ii) Contract assets
Contract assets arise when the Company performs its performance obligations by transferring goods to a customer
before the customer pays its consideration or before payment is due. Contract assets are treated as financial assets
for impairment purposes.
iii) Customer acquisition costs
Customer acquisition costs are capitalised as an asset where such costs are incremental to obtaining a contract with
a customer and are expected to be recovered. Customer acquisition costs are amortised on a straight-line basis over
the term of the contract.
Costs to obtain a contract that would have been incurred regardless of whether the contract was obtained or which are
not otherwise recoverable from a customer are expensed as incurred to profit or loss. Incremental costs of obtaining a
contract where the contract term is less than one year is immediately expensed to profit or loss.
iv) Customer fulfilment costs
Customer fulfilment costs are capitalised as an asset when all the following are met: (i) the costs relate directly to the
contract or specifically identifiable proposed contract; (ii) the costs generate or enhance resources of the Company
that will be used to satisfy future performance obligations; and (iii) the costs are expected to be recovered. Customer
fulfilment costs are amortised on a straight-line basis over the term of the contract.
v) Right of return assets
Right of return assets represents the right to recover inventory sold to customers and is based on an estimate of cus-
tomers who may exercise their right to return the goods and claim a refund. Such rights are measured at the value at

which the inventory was previously carried prior to sale, less expected recovery costs and any impairment.
vi) Contract liabilities
Contract liability is the obligation of the Company to transfer goods to a customer for which the Company has received
consideration from the customer. If a customer pays consideration before the Company transfers goods, a contract
liability is recognized when the payment is made. Contract liabilities are recognized as revenue when the Company
performs its performance obligations under the contract.
vii) Refund liabilities
Refund liabilities are recognised where the Company receives consideration from a customer and expects to refund
some, or all, of that consideration to the customer. A refund liability is measured at the amount of consideration received
or receivable for which the Company does not expect to be entitled and is updated at the end of each reporting period
for changes in circumstances. Historical data is used across product lines to estimate such returns at the time of sale
based on an expected value methodology.
viii) Impacts of adoption of IFRS 15 on these financial statements as on 01 July 2018
The following adjustments were made to the amounts recognized in the financial statements at 01 July 2018:
Statement of financial position 30 June 2018 Re- Adjustment 01 July 2018

ported Restated
- - - - - - - - - - - Rupees - - - - - - - - - -
Current assets
Stock in trade 10,447,356,778 1,008,464,541 11,455,821,319
Trade debts 8,124,577,164 (1,232,775,468) 6,891,801,696
Current liabilities
Trade and other payables 2,238,596,263 (11,215,546) 2,227,380,717
Equity
Reserves 11,308,233,791 (213,095,381) 11,095,138,410
2.19 Provisions
Provisions are recognized when the Company has a legal or constructive obligation as a result of past events and it
is probable that an outflow of resources embodying economic benefits will be required to settle the obligations and a
reliable estimate of the amount can be made.
2.20 Earnings per share
The Company presents earnings per share (EPS) data for its ordinary shares. EPS is calculated by dividing the profit
or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares out-
standing during the year.
2.21 Contingent assets
Contingent assets are disclosed when the Company has a possible asset that arises from past events and whose ex-
istence will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly
within the control of the Company. Contingent assets are not recognized until their realization becomes certain.
2.22 Contingent liabilities
Contingent liability is disclosed when the Company has a possible obligation as a result of past events whose existence

will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within
the control of the Company. Contingent liabilities are not recognized, only disclosed, unless the possibility of a future
outflow of resources is considered remote. In the event that the outflow of resources associated with a contingent li-
ability is assessed as probable, and if the size of the outflow can be reliably estimated, a provision is recognized in the
financial statements.
2.23 Impairment of non-financial assets
Assets that have an indefinite useful life are not subject to depreciation and are tested annually for impairment. Assets
that are subject to depreciation are reviewed for impairment at each statement of financial position date or whenever
events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is
recognized for the amount for which assets carrying amount exceeds its recoverable amount. Recoverable amount
is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment,
assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).
Non-financial assets that suffered an impairment are reviewed for possible reversal of the impairment at each reporting
date. Reversals of the impairment losses are restricted to the extent that the asset’s carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortization, if impairment losses had
not been recognized. An impairment loss or reversal of impairment loss is recognized in the statement of profit or loss.
2.24 Derivative financial instruments
Derivatives are initially recognized at fair value. Any directly attributable transaction costs are recognized in the state-
ment of profit or loss as incurred. They are subsequently remeasured at fair value on regular basis and at each report-
ing date as a minimum, with all their gains and losses, realized and unrealized, recognized in the statement of profit or
loss.
2.25 Cash and cash equivalents
Cash and cash equivalents are carried in the statement of financial position at book value which approximates their fair
value. For the purpose of statement of cash flows, cash and cash equivalents comprise cash in hand, cash at banks
on current, saving and deposit accounts, other short term highly liquid instruments that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
2.26 Segment reporting
Segment reporting is based on the operating (business) segments of the Company. An operating segment is a compo-
nent of the Company that engages in business activities from which it may earn revenues and incur expenses, includ-
ing revenues and expenses that relate to the transactions with any of the Company’s other components. An operating
segment’s operating results are reviewed regularly by the chief executive to make decisions about resources to be
allocated to the segment and assess its performance, and for which discrete financial information is available.
Segment results that are reported to the chief executive include items directly attributable to a segment as well as those
that can be allocated on a reasonable basis. Those incomes, expenses, assets, liabilities and other balances which
cannot be allocated to a particular segment on a reasonable basis are reported as unallocated.
The Company has following reportable business segments. Spinning – Zone 1, 2 and 3 (Producing different quality of
yarn using natural and artificial fibres), Weaving – Unit 1 and 2 (Producing different quality of greige fabric using yarn),
Processing and Home Textile (Processing greige fabric for production of printed and dyed fabric and manufacturing of
home textile articles) and Power Generation (Generating and distributing power).
Transaction among the business segments are recorded at arm’s length prices using admissible valuation methods.
Inter segment sales and purchases are eliminated from the total.

2.27 Government grants
Government grants are recognized when there is reasonable assurance that entity will comply with the conditions at-
tached to it and grant will be received.
2.28 Dividend and other appropriations
Dividend distribution to the ordinary shareholders is recognized as a liability in the Company’s financial statements in
period in which the dividends are declared and other appropriations are recognized in the period in which these are
approved by the Board of Directors.

3 SHARE CAPITAL
AUTHORIZED SHARE CAPITAL
2019 2018 2019 2018
(Number of shares) Rupees Rupees
280,000,000 280,000,000 Ordinary shares of Rupees 10 each 2,800,000,000 2,800,000,000
20,000,000 20,000,000 Preference shares of Rupees 10 each 200,000,000 200,000,000
300,000,000 300,000,000 3,000,000,000 3,000,000,000
ISSUED, SUBSCRIBED AND PAID-UP SHARE CAPITAL
2019 2018 2019 2018
(Number of shares) Rupees Rupees
134,757,848 134,757,848 Ordinary shares of Rupees 10 each fully paid in cash 1,347,578,480 1,347,578,480
104,239,443 104,239,443 Ordinary shares of Rupees 10 each issued as fully
paid bonus shares 1,042,394,430 1,042,394,430
1,224,265 1,224,265 Ordinary shares of Rupees 10 each issued as fully
paid for consideration other than cash to members of
Umer Fabrics Limited as per the Scheme of
Arrangement as approved by the Honourable Lahore 12,242,650 12,242,650
240,221,556 240,221,556 2,402,215,560 2,402,215,560
2019 2018
3.1 Ordinary shares of the Company held by companies that are related parties: (Number of shares)
Nishat Mills Limited 32,689,338 32,689,338
D.G. Khan Cement Company Limited 7,274,602 7,274,602
Adamjee Life Assurance Company Limited 2,202,500 1,300,000
42,166,440 41,263,940
2019 2018
Rupees Rupees
4. RESERVES
Composition of reserves is as follows:
Capital reserve
Share premium (Note 4.1) 600,553,890 600,553,890
Revenue reserves
General reserve 1,629,221,278 1,629,221,278
Unappropriated profit 10,706,447,714 9,078,458,623
12,335,668,992 10,707,679,901
12,936,222,882 11,308,233,791
4.1 This reserve can be utilized by the Company only for the purposes specified in section 81 of the Companies Act, 2017.
5. LONG TERM FINANCING
From banking companies / financial institutions - secured
Long term loans (Note 5.1)
- MCB Bank Limited - associated company 235,468,750 240,500,000
- Others 4,140,766,450 5,457,759,100
4,376,235,200 5,698,259,100
Long term musharaka (Note 5.2) 375,000,000 475,000,000
4,751,235,200 6,173,259,100
Less: Current portion shown under current liabilities (Note 9)
Long term loans:
- MCB Bank Limited - associated company 30,062,500 -
- Others 963,736,400 1,316,992,650
993,798,900 1,316,992,650
Long term musharaka 100,000,000 100,000,000
1,093,798,900 1,416,992,650
3,657,436,300 4,756,266,450
2019
5.1 Long term loans
57
RATE OF INTEREST PER INTEREST INTEREST
LENDER 2019 2018 NUMBER OF INSTALLMENTS
ANNUM REPRICING PAYABLE
Rupees Rupees
From MCB Bank Limited - associated

company:
MCB Bank Limited 160,000,000 160,000,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commencing on 25 July 2019 - Quarterly

and ending on 25 January 2027.
MCB Bank Limited 75,468,750 80,500,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commenced on 22 June 2019 - Quarterly
and ending on 22 December 2026.
235,468,750 240,500,000
From others:
Standard Chartered Bank (Pakistan) Limited - 187,500,000 3-month KIBOR + 0.75% Sixteen equal quarterly instalments commenced on 04 May 2015 Quarterly Quarterly
and ended on 04 February 2019.
Allied Bank Limited 9,647,500 17,365,500 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 22 October - Quarterly
2016 and ending on 22 July 2020.
Allied Bank Limited 54,000,000 90,000,000 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 07 January - Quarterly
2017 and ending on 10 October 2020.
Allied Bank Limited 58,125,000 96,875,000 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 20 January - Quarterly
Allied Bank Limited 30,681,000 48,213,000 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 11 May 2017 - Quarterly
and ending on 11 February 2021.
Allied Bank Limited 220,312,500 235,000,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commenced on 24 February - Quarterly
2019 and ending on 24 November 2026.
Allied Bank Limited 127,584,375 131,700,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commenced on 18 April - Quarterly
2019 and ending on 18 January 2027.
Allied Bank Limited 378,781,250 391,000,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commenced on 19 April - Quarterly
2019 and ending on 19 January 2027.
Allied Bank Limited 92,612,500 104,562,500 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 21 May 2017 - Quarterly
Allied Bank Limited 117,800,000 117,800,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commencing on 03 July - Quarterly
2019 and ending on 03 April 2027.
Askari Bank Limited 87,500,000 157,500,000 3-month KIBOR + 0.70% Twenty equal quarterly instalments commenced on 08 December Quarterly Quarterly
2015 and ending on 08 September 2020.
Askari Bank Limited 124,500,000 141,100,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 02 February - Quarterly
Askari Bank Limited 15,000,000 17,000,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 04 February - Quarterly
Askari Bank Limited 112,500,000 127,500,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 08 March 2017 - Quarterly
Askari Bank Limited 103,540,000 116,900,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 22 June 2017 - Quarterly
and ending on 22 March 2027.
Askari Bank Limited 4,960,000 5,580,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 12 September - Quarterly
2017 and ending on 12 June 2027.
5.1 Long term loans
RATE OF INTEREST PER INTEREST INTEREST
LENDER 2019 2018 NUMBER OF INSTALLMENTS
Rupees Rupees
Askari Bank Limited 46,200,000 51,800,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 04 October 2017 - Quarterly
From MCB Bank Limited - associated and ending on 04 July 2027.
company:
Askari Bank Limited 16,747,500 18,777,500 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 04 October 2017 - Quarterly
and ending on 04 July 2027.
MCB Bank
Askari BankLimited
Limited 160,000,000
16,000,000 160,000,000
18,000,000 SBP
SBP rate
rate for
for LTFF 1.00%
LTFF ++ 1.00% Sixteen
Forty equal half yearly
equalquarterly instalments
instalments commencing
commenced on 25
on 26 August 2019
July 2017 -- Quarterly
Quarterly
and
and ending
ending on
on 26 January
25 May 2027.2027.
Askari Bank Limited 94,240,000 106,020,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 26 August 2017 - Quarterly
and ending on 26 May 2027.
MCB Bank Limited 75,468,750 80,500,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commenced on 22 June 2019 - Quarterly
and ending on 26 May 2027.
235,468,750 240,500,000 and ending on 26 May 2027.
Pak
From Kuwait Investment Company (Private)
others: 24,491,000 38,487,000 SBP rate for LTFF + 0.75% Eighteen equal quarterly instalments commenced on 22 November - Quarterly
Limited 2016 and ending on 22 February 2021.
The
Standard
Bank Chartered
of Punjab Bank (Pakistan) Limited 300,000,000
- 400,000,000
187,500,000 3-month
3-monthKIBOR
KIBOR++0.75%
0.75% Ten equal
Sixteen equal yearly instalments
halfquarterly instalments commenced
commenced on
on 30
04 September
May 2015 Quarterly
Quarterly Quarterly
Quarterly
2017 and ending
and ended on 04 on 30 March
February 2022.
2019.
Habib
Allied Bank Limited
Bank Limited 1,400,000,000
9,647,500 1,800,000,000
17,365,500 3-month
SBP rateKIBOR + 0.50%
for LTFF + 1.00% Ten equal
Sixteen half yearly
equal instalments
quarterly commenced
instalments on 27
commenced on March 2018
22 October Quarterly
- Quarterly
Quarterly
and ending 27 September 2022.
2016 and ending on 22 July 2020.
Soneri
Allied Bank Limited
BankLimited 290,140,625
54,000,000 299,500,000
90,000,000 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
1.00% Thirty
Sixteentwo equal
equal quarterly
quarterly instalments
instalments commenced
commenced on on07 14 June
January -- Quarterly
Quarterly
2019
2017 and
and ending
ending on
on 14
10 March
October2027.
2020.
Soneri
Allied Bank Limited
58,125,000 222,000,000
96,875,000 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
1.00% Thirty
Sixteentwo equal
equal quarterly
quarterly instalments
commenced on on 06 July
20 January -- Quarterly
Quarterly
2019 and ending on 06 April 2027.
Allied Bank Limited
Syndicated term finance 30,681,000 48,213,000 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 11 May 2017 - Quarterly
Allied
Allied Bank Limited
Bank Limited 220,312,500- 220,000,000
235,000,000 3-month for LTFF
SBP rateKIBOR + 1%
+ 1.00% Ten two equal
Thirtyequal quarterly
half yearly instalments
instalments commenced February
commencedonon2724December -
Quarterly Quarterly
2014
2019 and ended
ending on
on 27 November
24 June 2019. 2026.
Allied Bank
Habib Bank Limited
Limited 127,584,375- 131,700,000
SBP rateKIBOR + 1%
+ 1.00% Ten Thirtyequal
two half quarterly
equalyearly instalments
commenced 18 April
on 27onDecember -
Quarterly Quarterly
2014
2019 and ended
ending on
on 27 January
18 June 2027.
2019.
Allied Bank
Habib Metropolitan
Limited Bank Limited 378,781,250- 391,000,000
SBP rateKIBOR + 1%
+ 1.00% Ten Thirtyequal
two half quarterly
equalyearly instalments
commenced 19 April
on 27onDecember -
Quarterly Quarterly
2014
2019 and ended
ending on
on 27 January
19 June 2027.
2019.
Allied Bank Limited 92,612,500- 104,562,500 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 21 May 2017
300,000,000 - Quarterly
4,140,766,450 5,457,759,100 and ending on 21 February 2027.
Allied Bank Limited 117,800,000 117,800,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commencing on 03 July - Quarterly
4,376,235,200 5,698,259,100 2019 and ending on 03 April 2027.
5.2 Long
Askariterm Limited
Bankmusharaka 87,500,000 157,500,000 3-month KIBOR + 0.70% Twenty equal quarterly instalments commenced on 08 December Quarterly Quarterly
2015 and ending on 08 September 2020.
Askari Bank Limited 124,500,000 141,100,000 SBP RATE
rateOF LTFF + 1.00%
for PROFIT PER Forty equal quarterly instalments commenced on 02 February -
PROFIT Quarterly
PROFIT
LENDER 2019 2018 2017 and ending NUMBER
on 02 OF INSTALLMENTS
November 2026.
Askari Bank Limited 15,000,000
Rupees 17,000,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 04 February
Rupees - Quarterly
Askari Bank
Faysal Bank Limited
Limited 112,500,000
375,000,000 127,500,000 SBP
475,000,000 rate for
3-month KIBOR
LTFF++0.70% Forty equal
1.00% Twenty equalquarterly
quarterlyinstalments
instalmentscommenced
commencedonon0821March
May 2017
2018 -
Quarterly Quarterly
Quarterly
and ending on 08 December
and ending on 21 February 2023. 2026.
Askari Bank Limited 103,540,000 116,900,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 22 June 2017 - Quarterly
375,000,000 475,000,000
and ending on 22 March 2027.

Askari Bank Limited 4,960,000 5,580,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 12 September - Quarterly
5.3 Long term loans are secured by first joint pari passu hypothecation and equitable mortgage on all present and future fixed 2017 of the
assetsand Company
ending the extent
on 12toJune 2027. of Rupees 9,950.58 million (2018: Rupees 9,230.58 million).
58
5.4 Long term musharaka are secured by first joint pari passu hypothecation and equitable mortgage on all present and future fixed assets of the Company to the extent of Rupees 666.67 million (2018: Rupees 720 million).
2019
2019 2018
Rupees Rupees
6. TRADE AND OTHER PAYABLES
Creditors (Note 6.1) 1,073,409,851 881,574,246
Accrued liabilities 1,415,362,883 1,144,356,860
Advances from customers 112,499,908 72,570,280
Securities from contractors - interest free and repayable on
completion of contracts (Note 6.2) 4,291,800 3,628,300
Retention money 221,639 429,946
Income tax deducted at source 12,874,420 8,908,559
Fair value of forward exchange contracts 18,467,940 -
Workers' profit participation fund (Note 6.3) 173,467,708 106,879,305
Others 32,014,241 20,248,767
2,842,610,390 2,238,596,263
6.1 These include amount due to following related party:
Adamjee Insurance Company Limited 724,420 925,877
6.2 These deposits have been utilized for the purpose of business in accordance with the terms of written agreements
with contractors.
6.3 Workers' profit participation fund

Balance as at 01 July 106,879,305 72,494,888
Less: Adjustment on adoption of IFRS 15 (11,215,546) -
95,663,759 72,494,888
Add: Interest for the year (Note 29) 7,076,497 12,821,913
Add: Allocation for the year (Note 27) 173,467,708 106,879,305
276,207,964 192,196,106
Less : Payments during the year 102,740,256 85,316,801
Balance as at 30 June 173,467,708 106,879,305
6.3.1 The Company retains wokers' profit participation fund for its business operations till the date of allocation to workers.
Interest is paid at prescribed rate under the Companies Profit (Workers' Participation) Act, 1968 on funds utilized by the
Company till the date of allocation to workers.
2019 2018
Rupees Rupees
7. ACCRUED MARK-UP
Long term financing
- Others 73,665,653 67,623,410
75,461,565 69,422,219
Short term borrowings
- MCB Bank Limited - associated company - 2,024,052
- Others 355,918,022 139,649,411
355,918,022 141,673,463
431,379,587 211,095,682

2019 2018
Rupees Rupees
8. SHORT TERM BORROWINGS
From banking companies - secured
Short term running finances (Notes 8.1 and 8.2)
- MCB Bank Limited - associated company 10,396,890 1,151,049,431

- Others 3,598,081,270 1,136,683,425
3,608,478,160 2,287,732,856
Export finances - Preshipment / SBP refinance (Notes 8.1 and 8.3)

- Others 8,093,500,000 7,150,000,000
8,093,500,000 7,550,839,000
Other short term finances (Notes 8.1 and 8.4) 8,390,000,000 7,183,420,000
20,091,978,160 17,021,991,856
8.1 These finances are obtained from banking companies under mark-up arrangements and are secured by hypothecation
of all present and future current assets of the Company and lien on export bills to the extent of Rupees 37,294 million
(2018: Rupees 32,096 million) and ranking charge on all present and future current assets of the Company to the extent
of Rupees 1,132.667 million (2018: Rupees 4,786 million). These form part of total credit facilities of Rupees 28,065
million (2018: Rupees 26,765 million).
8.2 The rates of mark-up range from 7.02% to 14.05% (2018: 6.25% to 7.67%) per annum on the balance outstanding.
8.3 The rates of mark-up on Pak Rupee finances and US Dollar finances range from 2.25% to 13.56% (2018: 2.25% to
6.89%) per annum and 3.00% to 3.30% (2018: 1.55% to 2%) per annum respectively on the balance outstanding.
8.4 The rates of mark-up range from 6.14% to 13.25% (2018: 6.08% to 7.13%) per annum on the balance outstanding.
8.5 Finances from MCB Bank Limited - associated company have been utilized for working capital purposes.
2019 2018
Rupees Rupees
9. CURRENT PORTION OF NON-CURRENT LIABILITIES
Current portion of long term financing (Note 5) 1,093,798,900 1,416,992,650
10. CONTINGENCIES AND COMMITMENTS
10.1 Contingencies
10.1.1 The Company preferred appeal against the Government of Punjab in the Honourable Lahore High Court, Lahore
against imposition of electricity duty on internal generation and the writ petition has been accepted. However,
Government of Punjab has moved to the Honourable Supreme Court of Pakistan against the order of Honourable
Lahore High Court, Lahore. The Company has fully provided its liability in respect of electricity duty on internal
generation. As at the reporting date, an amount of Rupees 72.009 million (2018: Rupees 69.963 million) is payable on
this account but the management of the Company is confident that payment of electricity duty will not be required.

10.1.2 The Collectorate of Customs (Export) has issued show cause notices with the intention to reject the duty draw back
claims aggregating to Rupees 9.482 million on blended grey fabrics exported under Duty and Tax Remission Rules
for Export (DTRE) scheme. The department is of the view that the Company has not submitted Appendix-1 as per Rule
297-A of the above referred scheme. The Company considers that since it has taken benefit of remission of sales tax
only, it is entitled to full duty draw back and filed appeal before Appellate Tribunal Inland Revenue (ATIR), Karachi
Bench which was decided against the Company. The Company also applied to Federal Board of Revenue (FBR) to
constitute Alternate Dispute Resolution Committee (ADRC) in terms of section 195C of the Customs Act, 1969 to settle
the dispute. ADRC vide its order dated 16 April 2008 has recommended the case in favour of the Company and
forwarded the case to FBR. However, FBR has not accepted the recommendations of ADRC. The Company has filed
appeal before the Honourable High Court of Sindh on 07 December 2013 against the order of ATIR. The appeal is
pending decision.
10.1.3 The Company impugned selection of its tax affairs for audit in terms of section 177 of the Income Tax Ordinance, 2001
for tax year 2009 in Honourable Lahore High Court, Lahore through writ petition. After dismissal of writ petition by the
Honourable Lahore High Court, Lahore, the tax department has completed the audit of tax year 2009 of income tax
affairs of the Company and Deputy Commissioner Inland Revenue (DCIR) has passed an order under sections
122(1)/122(5) of the Income Tax Ordinance, 2001 creating a tax demand of Rupees 6.773 million. The Company has
filed appeal before Commissioner Inland Revenue (Appeals) [CIR(A)] against the decision of DCIR which is pending
adjudication. No provision against this demand has been made in these financial statements as the Company is
hopeful of a favourable outcome of appeal based on the opinion of the tax advisor.
10.1.4 As a result of withholding tax audit for the tax year 2006, DCIR has raised a demand of Rupees 32.156 million under
sections 161 and 205 of the Income Tax Ordinance, 2001. The Company's appeal before ATIR was successful. The
Company also challenged the initiation of proceedings, under section 161 and 205 of the Income Tax Ordinance, 2001
pertaining to tax years 2007, 2008, 2009, 2010, 2011 and 2012 in the Honourable Lahore High Court, Lahore through a
writ petition. The Honourable Lahore High Court, Lahore directed the Tax Department to issue notice for reconciliation
and in case default is established only then action under section 205 of the Income Tax Ordinance, 2001 can be taken.
The Company also filed intra court appeals to the Honourable Lahore High Court, Lahore, which were dismissed.
Against this dismissal, appeal has been filed before the Supreme Court of Pakistan which is pending adjudication. The
management of the Company believes that the favourable outcome of its appeal before ATIR, in respect of tax year
2006 on same issues, will dispose of the initiation of these proceedings. In respect of tax year 2012, the case has
been decided at departmental level as stated in Note 10.1.7, hence appeal filed before the Supreme Court of Pakistan
in respect of tax year 2012 shall be withdrawn shortly.
10.1.5 The Company is in appeal before ATIR as its appeal before CIR(A) against the order of Additional Commissioner
Inland Revenue (ACIR) was unsuccessful. ACIR has passed an order under section 122(5A) of the Income Tax
Ordinance, 2001 for tax year 2011 whereby a demand of Rupees 6.822 million has been raised. No provision against
the demand has been made in these financial statements as the Company is hopeful of a favourable outcome of
appeal based on opinion of the tax advisor.
10.1.6 The Deputy Collector (Refund – Gold) by order dated 16 May 2007 rejected the input tax claim of the Company, for the
month of June 2005, amounting to Rupees 1.604 million incurred in zero rated local supplies of textile and articles
thereof on the grounds that the input tax claim is in contravention of SRO 992(I)/2005 which states that no registered
person engaged in the export of specified goods (including textile and articles thereof) shall, either through zero-rating
or otherwise, be entitled to deduct or reclaim input tax paid in respect of stocks of such goods acquired up to 05 June
2005, if not used for the purpose of exports made up to the 31 December 2005. The appeal of the Company before
ATIR was successful and input tax claim of the Company is expected to be processed after necessary verification in
this regard. Pending the outcome of verification no provision for inadmissible input tax has been recognized in these
10.1.7 The ACIR through an order under section 161/205 of the Income Tax Ordinance, 2001 created a demand of Rupees
147.745 million for tax year 2012 on account of alleged non-deduction of income tax on payments against the heads
commission to selling agents on exports and export marketing expenses. Being aggrieved, the Company filed an
appeal before CIR(A), who vide order dated 09 June 2016 accepted the stance of the Company and deleted the
demand related to commission to selling agents on exports, whereas, with respect to export marketing expenses,
CIR(A) remanded back the case to ACIR. However, the Company has filed appeal before ATIR which is pending for
fixation. Based on grounds and facts, the appeal is likely to be decided in favour of the Company. The demand
created under section 161/205 of the Income Tax Ordinance, 2001 of tax year 2012 amounting to Rupees 147.745
million by ACIR was subsequently reduced to Rupees 165,593 through appeal effect order issued by ACIR.

10.1.8 The Company filed appeal before CIR(A) against the order of ACIR. ACIR passed an order under section 122(5A) of
the Income Tax Ordinance, 2001 for tax year 2012 whereby a demand of Rupees 125.162 million has been raised.
CIR(A) vide order dated 29 June 2016 has deleted some of the additions made by ACIR. Being aggrieved by the
order of CIR(A), the Company as well as the tax department have preferred appeals before the ATIR which are
pending adjudication. No provision against this demand has been made in these financial statements as the Company
is hopeful for a favourable outcome of appeal based on the opinion of the tax advisor.
10.1.9 The Company filed appeal before CIR(A) against the order of ACIR. ACIR passed an order under section 122(5A) of
the Income Tax Ordinance, 2001 for tax year 2010 whereby a demand of Rupees 142.956 million has been raised.
CIR(A) vide order dated 28 October 2016 has deleted some of the additions made by ACIR. Being aggrieved by the
order of CIR(A), the Company as well as the tax department have preferred appeals before the ATIR which are
pending adjudication. No provision against this demand has been made in these financial statements as the Company
is hopeful for a favourable outcome of appeal based on the opinion of the tax advisor.
10.1.10 The Deputy Commissioner Inland Revenue passed an order under sections 161/205 of the Income Tax Ordinance,
2001 creating a demand of Rupees 19.073 million for the tax year 2014. The Company preferred an appeal against this
order before CIR(A). The CIR(A) adjudicated that impugned order is unsustainable and remanded back the matter to
taxation officer for consideration of legal grounds and merits of the case. The Company has also filed an appeal
before ATIR against the order of CIR(A). The proceedings before both forums are pending for adjudication. No
provision against this demand has been made in these financial statements as the Company is confident of favorable
outcome of its appeals.
10.1.11 Through show cause notice, the Collector of Customs, Karachi raised demand of Rupees 23.585 million on the
grounds that the Company was not entitled for exemption of sales tax and facility of reduced rate of income tax on 13
consignments of cotton imported during the period from April 2013 to April 2014. The vires of show cause notice were
challenged in Honorable Sindh High Court at Karachi from where stay was granted with the direction to the Collector
that he will not pass final order pursuant to the impugned show cause notice particularly in respect of advance income
tax till next date of hearing. In spite of the categorical orders of the Honorable High Court, the Collector passed order,
creating the demand of the aforesaid amount. Appeal against the said order filed in ATIR, Karachi has been
dismissed. Custom reference application has been filed in Sindh High Court, Karachi against the order of ATIR. There
is sufficient case law on the subject and there is every likelihood that case will be decided in favour of the Company.
10.1.12 The Company is contesting sales tax demands / rejections of sales tax by taxation authorities amounting to Rupees
7.098 million at various forums. These demands have been raised on account of various issues, like refund of sales
tax on purchases of furnace oil and diesel, non-provision of documents against certain refund processing system
objections and supplies made to certain parties. No provision against the aforesaid demands has been made in these
financial statements as the management is confident of favourable outcome of its appeals based on advice of the legal
counsel. The name of the Company was selected by the FBR through balloting for audit of its sales tax record of tax
year 2014. Writ petition against the selection was filed and in pursuance of Court's order, the record was submitted to
the assessing officer. Based on the audit, Deputy Commissioner has issued a show cause notice on account of
alleged discrepancies/observations noted during audit to the tune of Rupees 7.480 million. The Company has
challenged the vires of show cause notice in Lahore High Court, Lahore and expects favourable outcome of the
matter, hence no provision has been recognized in these financial statements.
10.1.13 Being aggrieved, the Company is in appeal before ATIR against the order of CIR(A). The ACIR has passed an order
under section 122(5A) of the Income Tax Ordinance, 2001 for tax year 2013 whereby a demand of Rupees 27.845
million has been raised. The appeal before CIR(A) has been decided and some matters have been decided in favour
of the Company. No provision against this demand has been made in these financial statements as the Company is
hopeful for a favourable outcome of appeal based on the opinion of the tax advisor.
10.1.14 The DCIR issued a show cause notice dated 12 April 2019 under section 177(1) of the Income Tax Ordinance, 2001 for
providing certain record and documents for tax year 2013. In response thereto, various replies were submitted with the
DCIR. In response to submissions of the Company, the DCIR issued an audit report u/s 177(6) of the Income Tax
Ordinance, 2001 and then passed an order under sections 122(4)/122(5)/214C of the Income Tax Ordinance, 2001
creating a demand of Rupees 277.772 million. Being aggrieved with the order passed by the DCIR, an appeal has
been filed before CIR(A)-I which is pending for fixation. However, the outcome of the appeal is expected to be
decided in favour of the Company.

10.1.15 The DCIR issued a show cause notice dated 20 March 2019 under section 161(1A) of the Income Tax Ordinance, 2001
for tax year 2017, wherein, the Company was required to explain the taxes deducted against payments amounting to
Rupees 133.361 million made on account of commission to selling agents. In response thereto, a reply dated 28
March 2019 was submitted with the DCIR. The DCIR without considering the arguments put forth by the Company
passed an order dated 05 April 2019 raising a demand of Rupees 13.982 million. Being aggrieved with the order
passed by the DCIR, an appeal was filed before CIR(A)-I which culminated in an order under section 129(1)(b) read
with section 161(1A) of Income Tax Ordinance, 2001 dated 27 June 2019, wherein, the stance of the DCIR was upheld.
Being aggrieved with the order passed by the CIR(A)-I, an appeal was filed before ATIR, the outcome of which is
expected to be decided in favour of the Company.
10.1.16 The DCIR issued a show cause notice dated 20 March 2019 under section 161(1A) of the Income Tax Ordinance, 2001
for tax year 2018, wherein, the Company was required to explain the taxes deducted against payments amounting to
Rupees 213.382 million made on account of commission to selling agents. In response thereto, a reply dated 28
March 2019 was submitted with the DCIR. The DCIR without considering the arguments put forth by the taxpayer,
passed an order dated 05 April 2019 raising a demand to the tune of Rupees 15.130 million. Being aggrieved with the
order passed by DCIR, an appeal was filed before CIR(A)-I which culminated in an order under section 129(1)(b) rear
with section 161(1A) of Income Tax Ordinance, 2001 dated 27 June 2019, wherein, the stance of the DCIR was upheld.
Being aggrieved with the order passed by the CIR(A)-I, an appeal was filed before ATIR, the outcome of which is
expected to be decided in favour of the Company.
10.1.17 The Company has challenged, before Honourable Lahore High Court, Lahore, the vires of first proviso to sub-clause
(x) of clause (4) of SRO 491(1)/2016 dated 30 June 2016 issued under sections 3 and 4 read with sections 8 and 71 of
the Sales Tax Act, 1990 whereby through amendment in the earlier SRO 1125(I)/2011 dated 31 December 2011
adjustment of input sales tax on packing material of all sorts has been disallowed. The learned single judge of
Honourable Lahore High Court has dismissed the writ petition of the Company, therefore intra court appeal has been
filed. The Company has claimed input sales tax amounting to Rupees 178.417 million (2018: Rupees 178.417 million)
paid on packing material in its respective monthly sales tax returns. The management, based on advice of the legal
counsel, is confident of favorable outcome of its appeal.
10.1.18 Guarantees of Rupees 671.040 million (2018: Rupees 609.109 million) are given by the banks of the Company to Sui
Northern Gas Pipelines Limited against gas connections, Shell Pakistan Limited against purchase of furnace oil,
Lahore Electric Supply Company against electricity connections, Director Excise and Taxation, Karachi against
infrastructure cess, Chairman Punjab Revenue Authority, Lahore against infrastructure cess, Director Pakistan Central
Cotton Committee against cotton cess, and Nazir, Honourable High Court, Sindh against the notification in accordance
with section 8 of OGRA Ordinance 2002, regarding system gas tariff on industrial and captive units.
10.1.19 Post dated cheques have been issued to custom authorities in respect of duties amounting to Rupees 3,544.173
million (2018: Rupees 3,234.598 million) on imported material availed on the basis of consumption and export plans. In
the event the documents of exports are not provided on due dates, cheque issued as security shall be encashable.
10.1.20 The Company has issued cross corporate guarantees of Rupees 12.295 billion (2018: Rupees 14.520 billion) on behalf
of NC Electric Company Limited - wholly-owned subsidiary company to secure the obligations of subsidiary company
towards its lenders.
10.2 Commitments
10.2.1 Letters of credit other than for capital expenditure amounting to Rupees 545.153 million (2018: Rupees 1,265.473 million)
10.2.2 Outstanding foreign currency forward contracts of Rupees 288.140 million (2018: Rupees 418.294 million).
2019 2018
Rupees Rupees
11. FIXED ASSETS
Property, plant and equipment:
Operating fixed assets (Note 11.1) 10,820,177,910 11,287,175,272
Capital work-in-progress (Note 11.2) 292,298,932 72,468,238
11,112,476,842 11,359,643,510

11.1 Reconciliations of carrying amounts of operating fixed assets at the beginning and at the end of the year are as follows:
Operating fixed assets

Description Buildings on Plant and Standby Electric Factory Furniture, fixture Office Motor
Freehold land Total
freehold land machinery generators installations equipment and equipment equipment vehicles
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - -- - - - - - - - - - - - - - - - R u p e e s - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
At 30 June 2017
Cost 716,256,019 3,184,940,259 14,035,697,824 964,154,094 638,397,387 259,307,346 110,267,221 87,372,493 129,373,817 20,125,766,460
Accumulated depreciation - (1,185,792,302) (6,053,211,631) (625,753,971) (258,522,680) (136,561,541) (50,432,580) (37,726,993) (58,707,458) (8,406,709,156)
Net book value 716,256,019 1,999,147,957 7,982,486,193 338,400,123 379,874,707 122,745,805 59,834,641 49,645,500 70,666,359 11,719,057,304
Year ended 30 June 2018

Opening net book value 716,256,019 1,999,147,957 7,982,486,193 338,400,123 379,874,707 122,745,805 59,834,641 49,645,500 70,666,359 11,719,057,304
Additions 10,806,400 91,707,904 416,070,429 5,619,341 24,437,172 11,668,521 23,803,595 11,322,593 20,556,708 615,992,663
Disposals:
Cost - - (121,810,851) - (10,000) - (619,756) (1,154,420) (27,437,810) (151,032,837)
Accumulated depreciation - - 87,423,033 - 7,641 - 508,652 366,576 16,903,675 105,209,577
- - (34,387,818) - (2,359) - (111,104) (787,844) (10,534,135) (45,823,260)
Depreciation - (102,851,583) (783,457,347) (33,182,875) (39,226,962) (13,064,017) (9,957,019) (5,690,248) (14,621,384) (1,002,051,435)
Closing net book value 727,062,419 1,988,004,278 7,580,711,457 310,836,589 365,082,558 121,350,309 73,570,113 54,490,001 66,067,548 11,287,175,272
At 30 June 2018
Cost 727,062,419 3,276,648,163 14,329,957,402 969,773,435 662,824,559 270,975,867 133,451,060 97,540,666 122,492,715 20,590,726,286
Net book value 727,062,419 1,988,004,278 7,580,711,457 310,836,589 365,082,558 121,350,309 73,570,113 54,490,001 66,067,548 11,287,175,272

Additions 74,560,360 1,033,681 296,874,577 2,718,947 16,870,148 4,277,001 24,093,317 9,144,505 33,509,712 463,082,248
Disposals:
Cost - - (2,642,702) - - - - (925,080) (3,178,470) (6,746,252)
Accumulated depreciation - - 2,278,395 - 163,922 1,294,996 3,737,313
- - (364,307) - - - - (761,158) (1,883,474) (3,008,939)
Depreciation - (99,438,978) (743,161,962) (2,970,777) (37,279,026) (12,382,495) (11,245,415) (5,889,659) (14,702,359) (927,070,671)
At 30 June 2019
Cost 801,622,779 3,277,681,844 14,624,189,277 972,492,382 679,694,707 275,252,868 157,544,377 105,760,091 152,823,957 21,047,062,282
Net book value 801,622,779 1,889,598,981 7,134,059,765 310,584,759 344,673,680 113,244,815 86,418,015 56,983,689 82,991,427 10,820,177,910
Number of
Annual rate of depreciation (%) 5 10 hours used 10 10 10 10 20

64
2019
2019
65
11.1.1 Detail of operating fixed assets, exceeding the book value of Rupees 500,000, disposed of during the year is as follows:
Accumulated Net book Sale

Description Qty Cost Gain Mode of disposal Particulars of purchaser
depreciation value proceeds
- - - - - - - - - - - - - - - - - - - - - - - - - Rupees - - - - - - - - - - - - - - - - - - - - - - - - -

Motor vehicles
Cultus VXL LEH-17-5836 1 1,417,010 (393,378) 1,023,632 1,042,720 19,088 Company's policy Mr. Imran Raza (Ex-employee), Lahore
Aggregate of other items of operating

fixed assets with individual book values
not exceeding Rupees 500,000 5,329,240 (3,343,934) 1,985,307 2,082,544 97,238
6,746,250 (3,737,312) 3,008,939 3,125,264 116,326
2019 2018
Rupees Rupees
11.1.2 The depreciation charge for the year has been allocated as follows:
Cost of sales (Note 24) 920,054,208 995,439,652

Administrative expenses (Note 26) 7,016,463 6,611,783
927,070,671 1,002,051,435
11.1.3 Particulars of immovable fixed assets are as follows:
Manufacturing units and office Address Area of land
Acres
Manufacturing units
Spinning Units 1,4,5,7 and 8 49th Kilometre, Multan Road, Bhai Pheru, Tehsil 45.83
Chunian, District Kasur
Spinning Units 2,3,6 and Weaving 49th Kilometre, Multan Road, Kamogal, Tehsil Pattoki, 65.20
District Kasur.
Dyeing, Printing and Stitching 4th Kilometre, Manga Road, Raiwind. 34.78
Office 31-Q, 31-C-Q, 35-K and 10-N, Gulberg-II, Lahore. 2.02
147.83
2019 2018
Rupees Rupees
11.2 Capital work-in-progress
Civil works on freehold land 1,387,630 2,210

Mobilization advances 9,779,869 137,500
Letters of credit - 39,324
Advances for capital expenditures 281,131,433 72,289,204
292,298,932 72,468,238
2019 2018
Rupees Rupees
12 INTANGIBLE ASSET

Addition during the year - 257,650
Amortization during the year (Note 12.2) (559,136) (1,717,600)
As at 30 June 669,454 1,228,590
12.1 Cost as at 30 June 21,867,812 21,867,812

Accumulated amortization (21,198,358) (20,639,222)
Net book value as at 30 June 669,454 1,228,590
12.2 Amortization on intangible asset amounting to Rupees 0.559 million (2018: Rupees 1.718 million) has been
allocated to administrative expenses.
12.3 Intangible asset - computer software has been amortized at the rate 30% per annum.
2019 2018
Rupees Rupees
13 LONG TERM INVESTMENTS
Debt instruments (Note 13.1) 222,604,840 -
Equity instruments (Note 13.2) 3,086,681,200 3,186,681,200
3,309,286,040 3,186,681,200
13.1 Debt instruments
At amortized cost
Sales tax refund bonds (Note 13.1.1)
2,209 (2018: Nil) bonds of Rupees 100,000 each 220,900,000 -
Add: Accrued interest (Note 28) 1,704,840 -
222,604,840 -
13.1.1 These represent investment in sales tax refund bonds having maturity period of 3 years issued by FBR Refund
Settlement Company Limited under Section 67A of Sales Tax Act, 1990 against sales tax refund payment orders
issued in favour of the Company. These bonds are carried at amortized cost using effective interest at the rate of
9.14% per annum.
2019 2018
Rupees Rupees
13.2 Equity instruments
Subsidiary companies
Nishat Chunian Power Limited - quoted (Note 13.3)
187,585,820 (2018: 187,585,820) fully paid ordinary shares of Rupees 10
each. Equity held 51.07% (2018: 51.07%) 1,875,858,200 1,875,858,200
Nishat Chunian USA Inc. - unquoted
10 (2018: 10) fully paid shares with no par value per share
Equity held 100% (2018: 100%) 10,823,000 10,823,000
NC Electric Company Limited - unquoted (Note 13.4)
120,000,000 (2018: 120,000,000) fully paid ordinary shares of Rupees 10 each
Equity held 100% (2018: 100%) 1,200,000,000 1,200,000,000
NC Entertainment (Private) Limited - unquoted (Note 13.5)
Nil (2018: 10,000,000) fully paid ordinary shares of Rupees 10 each
Equity held Nil (2018: 100%) - 100,000,000
3,086,681,200 3,186,681,200
13.3 The Company has pledged 187,354,914 (2018: 187,354,914) ordinary shares to lenders of Nishat Chunian Power
Limited for the purpose of securing finance.
13.4 3 ordinary shares of NC Electric Company Limited are in the name of directors nominated by the Company.
13.5 In order to concentrate on the core business of the Company, the board of directors of the Company in their
meeting held on 24 July 2018 and subsequently the shareholders of the Company in their Extra Ordinary General
Meeting held on 20 August 2018 approved the sale of NC Entertainment (Private) Limited - wholly owned
subsidiary company, to the highest bidder (Mr. Shahmir Yahya, a related party at that time). Total agreed
consideration received on disposal of investment in subsidiary company was Rupees 322 million.
14. LONG TERM LOANS TO EMPLOYEES
Considered good:
Executives (Notes 14.1 and 14.2) 12,660,518 12,469,463
Other employees (Note 14.2) 7,079,814 4,343,547
19,740,332 16,813,010
Less: Current portion shown under current assets (Note 18)
Executives 2,370,262 2,278,227
Other employees 1,453,775 594,411
3,824,037 2,872,638
15,916,295 13,940,372
14.1 Maximum aggregate balance due from executives at the end of any month during the year was Rupees 13.052
million (2018: Rupees 18.066 million).
14.2 These represent motor vehicle loans and house building loans to executives and employees, payable in 36 to
48 and 96 monthly instalments respectively. Interest on long term loans ranged from 7.27% to 13.79% (2018:
5.00% to 7.91%) per annum while some loans are interest free. Motor vehicle loans are secured against
registration of cars in the name of the Company, whereas house building loans are secured against balance
standing to the credit of employee in the provident fund trust account.
14.3 The fair value adjustment in accordance with the requirements of IFRS 9 'Financial Instruments' arising in respect
of staff loans is not considered material and hence not recognized.
2019 2018
Rupees Rupees
15. STORES, SPARE PARTS AND LOOSE TOOLS
Stores 360,980,969 362,151,590

Spare parts 333,498,032 272,408,584
Loose tools 57,875,028 52,183,148
752,354,029 686,743,322
16. STOCK-IN-TRADE
Raw materials 12,083,225,896 8,313,291,820

Work-in-process 1,039,191,965 902,207,503
Finished goods 2,538,481,385 1,124,942,023
Waste 60,348,016 106,915,432
15,721,247,262 10,447,356,778
16.1 Stock-in-trade of Rupees 122.130 million (2018: Rupees 245.976 million) is being carried at net realizable value.
16.2 This includes stock of Rupees 47.004 million (2018: Rupees 29.635 million) sent to outside parties for processing.
16.3 Finished goods include stock in transit of Rupees 808.954 million (2018: Rupees Nil).
2019 2018
Rupees Rupees
17. TRADE DEBTS
Considered good:
Secured:
- Others 4,507,665,384 6,560,173,418
Unsecured:
- Related parties (Notes 17.1 and 17.2) 1,174,374,779 851,269,251
- Others 749,379,019 713,134,495
1,923,753,798 1,564,403,746
Less: Allowance for expected credit losses (Note 17.5) (5,049,905) -
6,426,369,277 8,124,577,164

2019 2018
Rupees Rupees
17.1 This represents amounts due from following related parties:

Nishat Chunian USA Inc. - subsidiary company 1,065,307,467 811,797,986
Nishat Chunian Electric Company Limited - subsidiary company 41,650 -
Nishat Mills Limited - related party 109,025,662 39,471,265
1,174,374,779 851,269,251
17.2 The maximum aggregate amount receivable from related parties at the end of any month during the year was as
2019 2018
Rupees Rupees
Nishat Chunian USA Inc. - subsidiary company 1,065,307,467 811,797,986
Nishat Chunian Electric Company Limited - subsidiary company 41,650 -
17.3 As at 30 June 2019, trade debts due from other than related parties of Rupees 236.484 million (2018: Rupees
97.271 million) were past due but not impaired. These relate to a number of independent customers from whom
there is no recent history of default. The age analysis of these trade debts is as follows:
2019 2018
Rupees Rupees
Upto 1 month 64,550,298 75,236,313
1 to 6 months 35,696,260 20,464,444
More than 6 months 136,237,854 1,570,085
236,484,412 97,270,842
17.4 As at 30 June 2019, trade debts due from related parties amounting to Rupees 383.740 million (2018: Rupees
6.622 million) were past due but not impaired. The age analysis of these trade debts is as follows:
2019 2018
Rupees Rupees
Upto 1 month 247,357,625 6,622,459

1 to 6 months 136,382,192 -
More than 6 months - -
383,739,817 6,622,459
17.5 Allowance for expected credit losses
Opening balance - -
Add: Recognized as on 01 July 2018 5,288,510 -
Add: Reversal during the year (Note 27) (238,605) -
Closing balance 5,049,905 --

2019 2018
Rupees Rupees
18. LOANS AND ADVANCES
Considered good:
Employees - interest free:
- Executives 9,379,723 3,086,340
- Other employees 2,461,505 4,135,427
11,841,228 7,221,767
Current portion of long term loans to employees (Note 14) 3,824,037 2,872,638
Advances to suppliers (Note 18.1) 1,017,250,859 1,020,949,629
Short term loans to subsidiary companies (Note 18.2) 1,272,569,696 508,168,820
Advances to contractors 903,498 677,006
Letters of credit 54,965,342 325,386,772
2,361,354,660 1,865,276,632
18.1 These include advances amounting to Rupees 0.656 million (2018: Rupees Nil) to D.G. Khan Cement Company
Limited - related party and Rupees 1.044 million (2018: Rupees 2.003 million) to Adamjee Insurance Company
Limited - associated company. These are neither past due nor impaired.
18.1.1 The maximum aggregate amount of advances to related parties at the end of any month during the year was as
follows:
D. G. Khan Cement Company Limited 656,083 485,614
Adamjee Insurance Company Limited 12,865,998 4,758,980
18.2 These represent amounts due from following subsidiary companies:

2019 2018
Rupees Rupees
NC Electric Company Limited (Note 18.2.1) 1,272,569,696 448,338,227

NC Entertainment (Private) Limited (Note 18.2.1) - 59,830,593
1,272,569,696 508,168,820
18.2.1 Return on these loans is 3 months KIBOR + 2% or weighted average borrowing cost of the Company, whichever
is higher and these loans are repayable within one year from the date of disbursement. These are neither past
due nor impaired.
18.2.2 The maximum aggregate amount receivable from related parties at the end of any month during the year was as
follows:
2019 2018
Rupees Rupees
Nishat Chunian Power Limited 2,050,000,000 400,000,000
NC Electric Company Limited 1,272,569,696 502,400,646
NC Entertainment (Private) Limited 31,450,000 446,277,423

2019 2018
Rupees Rupees
19. OTHER RECEIVABLES
Considered good:
Sales tax recoverable 1,923,182,944 1,404,097,105
Advance income tax - net 723,167,479 894,405,910
Export rebate and claims 60,472,402 66,171,247
Duty drawback receivable 388,495,290 773,195,151
Fair value of forward exchange contracts - 8,493,361
Dividend receivable from Nishat Chunian Power Limited - subsidiary company 173,303,295 -
Due from NC Electric Company Limited - subsidiary company (Note 19.1) 173,902,058 162,119,504
Insurance claim receivable (Note 19.2) 3,225,000 77,192,605
Receivable from employees' provident fund trust (Note 19.3) 48,269,963 44,298,020
Miscellaneous 88,319,878 92,665,512
3,582,338,309 3,522,638,415
19.1 It is in the ordinary course of business.

19.1.1 The maximum aggregate amount receivable from related party at the end of any month during the year was as
follows:
2019 2018
Rupees Rupees
NC Electric Company Limited 173,902,058 162,119,504
19.1.2 The ageing analysis of this receivable is as follows:
Upto 1 month 1,007,984 1,923,525
1 to 6 months 3,924,201 11,080,344
More than 6 months 168,969,873 149,115,635
173,902,058 162,119,504
19.2 It includes Rupees Nil (2018: Rupees 48.519 million) receivable from Adamjee Insurance Company Limited -
associated company. It is neither past due nor impaired.
19.2.1 The maximum aggregate amount receivable from related party at the end of any month during the year was as
follows:
2019 2018
Rupees Rupees
Adamjee Insurance Company Limited - associated company 61,460,801 75,430,412
19.3 The maximum aggregate amount receivable from employees' provident fund trust at the end of any month during
the year was as follows:
Nishat (Chunain) Limited - Employees Provident Fund 53,329,092 51,815,842
20. ACCRUED INTEREST

On short term loans to:
NC Electric Company Limited - subsidiary company 152,055,594 33,082,811
NC Entertainment (Private) Limited - subsidiary company - 27,234,445
152,055,594 60,317,256
20.1 The maximum aggregate amount receivable from related parties at the end of any month during the year was as
follows:

2019 2018
Rupees Rupees
Nishat Chunian Power Limited 2,057,582 178,849
NC Electric Company Limited 152,055,594 33,082,811
NC Entertainment (Private) Limited 27,931,225 42,793,767
20.2 As at 30 June 2019, accrued interest of Rupees 152.056 million (2018: Rupees 49.204 million) was past due but
not impaired. The ageing analysis of this accrued interest is as follows:
Upto 1 month 30,407,982 -

1 to 6 months 51,183,276 20,575,839
More than 6 months 70,464,336 28,627,871
152,055,594 49,203,710
21. SHORT TERM INVESTMENTS
At amortized cost
Term deposit receipts (Note 21.1) 20,660,226 20,660,226
Add: Accrued interest 27,169 988,949
20,687,395 21,649,175
21.1 These represent deposits under lien with the bank of the Company against bank guarantees of the same amount
issued by the bank to Sui Northern Gas Pipelines Limited against gas connections. Interest on term deposit
receipts ranges from 3.40% to 12.00% (2018: 5.35% to 5.40%) per annum. The maturity period of these term
deposit receipts is 6 months.
2019 2018
Rupees Rupees
22. CASH AND BANK BALANCES
Cash with banks:

On saving accounts (Note 22.1)
Including US$ 14,482 (2018: US$ 14,464) 2,375,121 1,755,880
On current accounts
Including US$ 32,091 (2018: US$ 81,629) 11,629,282 71,149,757
14,004,403 72,905,637
Cash in hand 3,723,974 3,539,217
17,728,377 76,444,854
22.1 Rate of profit on saving accounts was 0.15% (2018: 3.75% to 4.50%) per annum.
22.2 Included in cash with banks are Rupees 2.343 million (2018: Rupees 18.578 million) with MCB Bank Limited -
associated company.
23. REVENUE
Export sales (Note 23.1) 19,471,414,677 20,044,767,534

Local sales (Note 23.2) 19,393,562,524 14,474,941,854
Processing income 315,107,202 298,465,790
Export rebate 41,331,090 36,725,636
Duty drawback 116,225,012 705,495,630
39,337,640,505 35,560,396,444
23.1 Export sales includes waste sales of Rupees Nil (2018: Rupees 5.908 million).

2019 2018
Rupees Rupees
23.2 Local sales
Sales (Note 23.2.1) 19,416,371,556 14,487,485,174
Less: Sales tax 22,809,032 12,543,320
19,393,562,524 14,474,941,854
23.2.1 Local sales includes waste sales of Rupees 1,090.913 million (2018: Rupees 957.844 million).
24. COST OF SALES
Raw materials consumed (Note 24.1) 24,977,051,290 22,062,016,901
Packing materials consumed 923,523,073 929,256,432
Stores, spare parts and loose tools consumed 1,240,985,576 1,045,779,001
Processing charges 396,891,327 415,688,173
Salaries, wages and other benefits (Note 24.2) 2,363,341,717 2,406,958,235
Fuel and power 3,609,586,036 3,266,258,933
Insurance 49,923,416 37,746,401
Postage and telephone 816,291 734,763
Travelling and conveyance 2,620,220 2,987,985
Vehicles' running and maintenance 26,244,380 27,686,394
Entertainment 8,592,043 9,215,023
Depreciation on operating fixed assets (Note 11.1.2) 920,054,208 995,439,652
Repair and maintenance 364,869,498 340,735,302
Other factory overheads 61,120,736 63,503,531
34,945,619,811 31,604,006,726
Work-in-process
Opening stock 902,207,503 681,950,465
Closing stock (1,039,191,965) (902,207,503)
(136,984,462) (220,257,038)
Cost of goods manufactured 34,808,635,349 31,383,749,688
Finished goods and waste - opening stocks
Finished goods (Note 24.3) 2,133,406,564 1,058,655,750
Waste 106,915,432 78,504,641
2,240,321,996 1,137,160,391
37,048,957,345 32,520,910,079
Finished goods and waste - closing stocks
Finished goods (2,538,481,385) (1,124,942,023)
Waste (60,348,016) (106,915,432)
(2,598,829,401) (1,231,857,455)
34,450,127,944 31,289,052,624
24.1 Raw materials consumed
Opening stock 8,313,291,820 6,831,007,143
Add: Purchased during the year 28,746,985,366 23,644,678,967
37,060,277,186 30,475,686,110
Less: Loss of cotton due to fire - 100,377,389
Less: Closing stock 12,083,225,896 8,313,291,820
24,977,051,290 22,062,016,901
24.2 Salaries, wages and other benefits include Rupees 19.345 million (2018: Rupees 21.958 million) and Rupees
46.370 million (2018: Rupees 42.141 million) in respect of accumulating compensated absences and provident
fund contribution by the Company respectively.
24.3 This includes the impact of adjustment on adoption of IFRS 15 amounting to Rupees 1,008.465 million.
2019 2018
Rupees Rupees
25. DISTRIBUTION COST
Salaries and other benefits (Note 25.1) 117,008,047 100,650,733
Ocean freight 118,569,960 147,469,280
Freight and octroi 127,174,352 122,991,035
Forwarding and other expenses 188,755,243 154,792,008
Export marketing expenses 140,986,208 142,214,145
Commission to selling agents 214,648,294 213,381,741
Rent, rates and taxes 21,719,135 11,965,560
Printing and stationery 23,388 4,170
Legal and professional 2,936,961 2,946,561
Electricity and sui gas 2,084,305 1,364,901
Entertainment 309,397 322,387
Miscellaneous 281,573 3,489,752
944,021,613 908,398,202
25.1 Salaries and other benefits include Rupees 1.052 million (2018: Rupees 3.145 million) and Rupees 4.846 million
(2018: Rupees 4.444 million) in respect of accumulating compensated absences and provident fund contribution
by the Company respectively.
26. ADMINISTRATIVE EXPENSES
Printing and stationery 5,001,468 4,499,527
Vehicles' running and maintenance - net 1,636,129 2,452,947
Postage and telephone - net 3,129,015 4,063,711
Fee and subscription 5,864,559 7,650,774
Auditor's remuneration (Note 26.2) 2,672,800 2,527,000
Electricity and sui gas - net 3,366,298 2,211,058
Insurance 2,526,414 2,492,695
Repair and maintenance - net 22,877,034 12,071,414
Entertainment 5,568,376 4,399,421
Amortization on intangible asset (Note 12) 559,136 1,717,600
Miscellaneous - net 2,195,475 2,364,774
278,123,593 222,242,176
(2018: Rupees 3.785 million) in respect of accumulating compensated absences and provident fund contribution
by the Company respectively.
26.2 Auditor's remuneration
Audit fee 1,770,000 1,700,000
Half yearly review 600,800 525,000
Certification fees 125,000 125,000
Reimbursable expenses 177,000 177,000
2,672,800 2,527,000
2019 2018
Rupees Rupees
27. OTHER EXPENSES
Donations (Note 27.1) 100,635,977 120,000
Reversal of allowance for expected credit losses (Note 17.5) (238,605) -
Loss on disposal of operating fixed assets - 22,114,873
273,865,080 129,114,178
27.1 Donations
These include donations amounting to Rupees 0.00425 million (2018: Rupees Nil) to Mian Muhammad Yahya
Trust, 31-Q, Gulberg II, Lahore in which Mr. Shahzad Saleem, Chief Executive, Mr. Aftab Ahmad Khan, Director
and Mrs. Farhat Saleem, Director are trustees and Rupees 100.012 million (2018: Rupees Nil) to Saleem
Memorial Trust Hospital, 31-Q, Gulberg II, Lahore in which Mr. Shahzad Saleem, Chief Executive and Mrs. Farhat
Saleem, Director are directors.
2019 2018
Rupees Rupees
28. OTHER INCOME
Income from financial assets
Return on bank deposits 1,273,024 1,043,978
Net exchange gain 1,382,125,541 779,705,584
Interest income on sales tax refund bonds 1,704,840 -
Income from investment in subsidiary companies
Dividend income from Nishat Chunian Power Limited 656,550,370 187,585,820
Gain on sale of shares of NC Entertainment (Private) Limited - subsidiary company 222,000,000 -
Income from loans to subsidiary companies
Interest income on short term loans 125,655,125 91,898,693
Income from non-financial assets
Gain on disposal of operating fixed assets (Note 11.1.1) 116,326 -
Credit balances written back 2,103,084 417,222
Sale of scrap 57,238,782 56,055,429
Gain on insurance claim of stock-in-trade written off due to fire - 14,122,611
Interest on total agreed consideration on disposal of investment in NC
Entertainment (Private) Limited - subsidiary company 5,441,654 -
Miscellaneous 231,184 1,052,393
2,454,439,930 1,131,881,730
29. FINANCE COST
Mark-up on:
- long term loans 310,700,942 314,176,801
- long term musharaka 42,145,630 37,171,056
- short term running finances 473,433,833 213,257,432
- export finances - Preshipment / SBP refinances 472,113,791 199,947,250
- short term finances - others 757,921,060 471,662,810
Interest on workers' profit participation fund (Note 6.3) 7,076,497 12,821,913
Bank charges and commission 114,184,396 134,327,592
2,177,576,149 1,383,364,854

2019 2018
Rupees Rupees
30. TAXATION
Current (Note 30.1) 500,774,516 397,022,293
30.1 Provision for current taxation represents minimum tax on local sales, final tax on export sales, super tax and tax
on income from other sources at applicable rates. Reconciliation of tax expense and product of accounting profit
multiplied by the applicable tax rate has not been presented, being impracticable.
2019 2018
Rupees Rupees
30.2 Deferred income tax asset
The asset for deferred income tax originated due to timing differences relating to:
Taxable temporary differences
Accelerated tax depreciation (512,869,400) (356,553,374)

Amortization on intangible asset (100,458) (300,608)
(512,969,858) (356,853,982)
Deductible temporary differences
Available tax losses 842,702,427 1,021,986,894

Minimum tax carry forward 178,755,016 -
1,021,457,443 1,021,986,894
Deferred income tax asset 508,487,585 665,132,912
Deferred income tax asset not recognized in these financial statements (508,487,585) (665,132,912)
Deferred income tax asset recognized in these financial statements - -
30.2.1 Deferred income tax asset of Rupees 508.488 million (2018: Rupees 665.133 million) has not been recognized in
these financial statements as the Company's management believes that sufficient taxable profits will not be
probably available in foreseeable future, hence, the temporary differences may not reverse.
30.3 The Company has carry forwardable tax losses of Rupees 2,906 million (2018: Rupees 3,524 million).
2019 2018
31. EARNINGS PER SHARE - BASIC AND DILUTED
Profit after taxation attributable to ordinary shareholders (Rupees) 3,167,591,540 2,363,083,847
Weighted average number of ordinary

shares outstanding during the year 240,221,556 240,221,556
Basic earnings per share (Rupees) 13.19 9.84
31.1 There is no dilutive effect on basic earnings per share for the year ended 30 June 2019 and 30 June 2018 as the
Company has no potential ordinary shares as on 30 June 2019 and 30 June 2018.

2019 2018
Rupees Rupees
32. CASH GENERATED FROM / (UTILIZED IN) OPERATIONS
Profit before taxation 3,668,366,056 2,760,106,140
Adjustments for non-cash charges and other items:
Depreciation on operating fixed assets 927,070,671 1,002,051,435
Amortization on intangible asset 559,136 1,717,600
Gain on sale of shares of subsidiary company (222,000,000) -
(Gain) / loss on disposal of operating fixed assets (116,326) 22,114,873
Dividend income (656,550,370) (187,585,820)
Finance cost 2,177,576,149 1,383,364,854
Return on bank deposits (1,273,024) (1,043,978)
Interest income on short term loans to subsidiary companies (125,655,125) (91,898,693)
Interest income on sales tax refund bonds (1,704,840)
Interest on total agreed consideration on disposal of investment in NC
Entertainment (Private) Limited - subsidiary company (5,441,654) -
Credit balances written back (2,103,084) (417,222)
Working capital changes (Note 32.1) (3,268,468,014) (5,562,841,105)
2,490,020,970 (674,431,916)
32.1 Working capital changes
(Increase) / decrease in current assets:
Stores, spare parts and loose tools (65,610,707) (106,678,604)
Stock-in-trade (4,265,425,943) (1,797,238,779)
Trade debts 460,382,514 (2,951,244,532)
Loans and advances 269,274,247 (513,315,798)
Short term prepayments (5,885,852) 4,637,139
Other receivables (278,535,030) (936,783,209)
(3,885,800,771) (6,300,623,783)
Increase in trade and other payables 617,332,757 737,782,678
(3,268,468,014) (5,562,841,105)
32.2 Reconciliation of movement of liabilities to cash flows arising from financing activities:
Liabilities from financing activities
Long term Short term Unclaimed Total
financing borrowings dividend
Rupees Rupees Rupees Rupees
Balance as at 01 July 2018 6,173,259,100 17,021,991,856 38,206,334 23,233,457,290
Repayment of financing / borrowings (1,422,023,900) - - (1,422,023,900)
Short term borrowings - net - 3,069,986,304 - 3,069,986,304
Dividend declared - - 1,321,218,558 1,321,218,558
Dividend paid - - (1,307,123,217) (1,307,123,217)
Balance as at 30 June 2019 4,751,235,200 20,091,978,160 52,301,675 24,895,515,035

33. REMUNERATION OF CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES
Aggregate amount charged in the financial statements for the year for remuneration including certain benefits to the chief
executive, directors and executives of the Company is as follows:
Chief Executive Directors Executives
2019 2018 2019 2018 2019 2018
--------------------------- Rupees ---------------------------
Managerial remuneration 21,280,683 7,300,000 3,600,000 - 62,100,000 55,683,472
Contribution to provident - - 299,880 - 5,172,930 4,638,433
fund
House rent 8,512,273 2,920,000 1,440,000 - 24,840,000 22,273,389
Utilities 2,128,068 730,000 360,000 - 6,210,000 5,568,347
Others 4,921,024 2,326,601 - - 15,405,681 6,630,813
36,842,048 13,276,601 5,699,880 - 113,728,611 94,794,454
Number of persons 1 1 1 - 32 29
33.1 The Company provides to chief executive, directors and certain executives with free use of Company maintained cars and
residential telephones.
33.2 Aggregate amount charged in these financial statements for meeting fee to eight (2018: eight) directors was Rupees 440,000
(2018: Rupees 340,000).
33.3 No remuneration was paid to non-executive directors of the Company.
34. TRANSACTIONS WITH RELATED PARTIES
Related parties comprise subsidiary companies, associated undertakings, other related companies, key management
personnel and post employment benefit plan. The Company in the normal course of business carried out transactions with
various related parties. Details of transactions with related parties, other than those which have been specifically disclosed
elsewhere in these financial statements are as follows:
2019 2018
Rupees Rupees
Subsidiary companies
Common facilities cost charged 19,200,000 19,200,000
Dividend income 656,550,370 187,585,820
Sale of goods 1,673,965,762 1,241,538,772
Purchase of electricity and steam 3,167,397,135 2,862,208,988
Issue of shares by subsidiary companies against advance for purchase of shares - 1,299,496,000
Advance for purchase of shares of subsidiary companies transferred to shot term
loans and other receivable - 715,549,313
Interest income 125,655,125 91,898,693
Short term loans made 10,435,298,011 5,555,722,451
Repayment / adjustment of short term loans made 9,670,897,136 5,831,045,869
Common area maintenance charges - 3,294,200
Associated undertakings
Mark up on borrowings 8,275,777 22,180,251
Long term loans repaid 5,031,250 -
Short term loans obtained 422,135 3,424,558,481
Short term loans repaid 410,920,537 3,543,044,395
Insurance premium paid 76,873,704 52,847,578
Insurance claims received 64,011,347 44,393,990
Other related parties

Purchase of goods 29,074,940 8,969,951
Sale of goods 2,482,930,242 1,780,323,001
Dividend paid 228,305,420 113,475,835
Company's contribution to employees' provident fund trust 55,180,153 50,369,376
34.1 Detail of compensation to key management personnel comprising of chief executive officer, directors and executives is
disclosed in (Note 33)
34.2 Following are the related parties with whom the Company had entered into transactions or have arrangements / agreements in
place:
Transactions entered
or agreements and /
Percentage of
Name of the related party Basis of relationship or arrangements in
shareholding
place during the
financial year
Nishat Chunian Power Limited Subsidiary company Yes 51.47

Nishat Chunian USA Inc. Wholly owned subsidiary company Yes 100
NC Electric Company Limited Wholly owned subsidiary company Yes 100
Nishat Mills Limited Share holding Yes None
D.G. Khan Cement Company Limited Share holding Yes None
MCB Bank Limited Common directorship Yes None
Saleem Memorial Trust Hospital Common directorship Yes None
Adamjee Insurance Company Limited Common directorship Yes None
Adamjee Life Assurance Company Common directorship Yes None
Pakgen Power Limited Common directorship No None
Mian Muhammad Yahya Trust Common directorship No None
Lalpir Solar Power (Private) Limited Common directorship No None
Nishat Energy Limited Common directorship No None
MCB Islamic Bank Limited Common directorship No None
Nishat Papers Products Company Limited Common directorship No None
Nishat (Aziz Avenue) Hotel and Common directorship No None
Properties Limited
Nishat (Gulberg) Hotel and Properties Common directorship No None
Limited
Nishat (Raiwind) Hotel and properties Common directorship No None
Limited
MCB Financial Services Limited Common directorship No None
Hyundai Nishat Motor (Private) Limited Common directorship No None
Nishat Hotels and Properties Limited Common directorship No None
Nishat (Chunian) Limited - Employees Post-employment benefit plan Yes None
Provident Fund
34.3 Particulars of company incorporated outside Pakistan with whom the Company had entered into transactions or had
agreements and / or arrangements in place are as follows:
Percentage of
Name of company Country of incorporation Basis of association
shareholding
Nishat Chunian USA Inc. USA Wholly owned subsidiary company 100

34.4 As on 30 June 2019, disclosures relating to investment made in foreign company are as follows:
Amount of investment Terms and Litigations Default / Gain / (loss)

Amount of
Name of the Beneficial Made during the conditions of against breach relating on disposal of
Jurisdiction Foreign returns
company owner year ended 30 Rupees investment / investee to foreign foreign
currency received
June advance company company investment
Long term investments:
Nishat USA Nishat 2013 10,823,000 USD 110,000 Investment in None None None Not applicable
Chunian USA (Chunian) shares of
Inc. Limited subsidiary
company
34.5 As on 30 June 2018, disclosures relating to investment made in foreign company are as follows:
Amount of investment Terms and Litigations Default / Gain / (loss)

Amount of
Name of the Beneficial Made during the conditions of against breach relating on disposal of
Jurisdiction Foreign returns
company owner year ended 30 Rupees investment / investee to foreign foreign
currency received
June advance company company investment
Long term investments:
Nishat USA Nishat 2013 10,823,000 USD 110,000 Investment in None None None Not applicable
Chunian USA (Chunian) shares of
Inc. Limited subsidiary
company
2019 2018
35 NUMBER OF EMPLOYEES
Number of employees as on 30 June 6,007 6,175
Average number of employees during the year 6,220 6,248

36. SEGMENT INFORMATION
Spinning Weaving
Elimination of inter-segment
Processing and Home Textile Power Generation Total - Company
transactions
Zone - 1 Zone - 2 Zone - 3 Unit - 1 Unit - 2
2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -Rupees - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Sales
- Export 6,544,926,861 5,513,721,391 3,585,633 933,560,146 711,738,260 2,648,603,969 231,388,061 - 2,565,926,289 3,364,613,526 9,571,405,675 8,326,489,768 - - - - 19,628,970,779 20,786,988,800
- Local 879,715,835 1,114,240,319 5,824,260,105 5,468,024,206 9,698,848,742 5,355,057,035 2,274,512,052 2,096,736,432 325,535,506 170,013,206 705,797,486 569,336,446 - - - - 19,708,669,726 14,773,407,644
7,424,642,696 6,627,961,710 5,827,845,738 6,401,584,352 10,410,587,002 8,003,661,004 2,505,900,113 2,096,736,432 2,891,461,795 3,534,626,732 10,277,203,161 8,895,826,214 - - - - 39,337,640,505 35,560,396,444
Inter-segment 229,697,514 339,741,212 1,007,800,402 785,707,298 1,462,940,659 1,063,267,588 5,441,169,108 4,226,026,282 - - 5,277,726,306 4,605,800,741 3,020,515,488 2,756,339,556 (16,439,849,477) (13,776,882,677) - -
7,654,340,210 6,967,702,922 6,835,646,140 7,187,291,650 11,873,527,661 9,066,928,592 7,947,069,221 6,322,762,714 2,891,461,795 3,534,626,732 15,554,929,467 13,501,626,955 3,020,515,488 2,756,339,556 (16,439,849,477) (13,776,882,677) 39,337,640,505 35,560,396,444
Cost of sales (6,726,041,137) (6,099,110,592) (6,088,618,372) (6,291,325,438) (10,738,612,705) (7,936,647,248) (7,388,850,953) (6,003,241,232) (2,657,771,561) (3,356,003,996) (14,273,622,259) (12,635,864,057) (3,016,460,434) (2,743,742,738) 16,439,849,477 13,776,882,677 (34,450,127,944) (31,289,052,624)
Gross profit 928,299,073 868,592,330 747,027,768 895,966,212 1,134,914,956 1,130,281,344 558,218,268 319,521,482 233,690,234 178,622,736 1,281,307,208 865,762,898 4,055,054 12,596,818 - - 4,887,512,561 4,271,343,820
Distribution cost (125,641,754) (84,419,943) (56,152,715) (87,080,457) (90,686,392) (109,853,937) (100,949,630) (97,172,238) (42,261,144) (54,322,392) (528,329,978) (475,549,235) - - - - (944,021,613) (908,398,202)
Administrative expenses (45,023,655) (30,468,371) (30,889,291) (31,428,589) (49,913,504) (39,647,865) (41,401,081) (30,909,604) (17,331,981) (17,279,458) (93,564,081) (72,508,289) - - - - (278,123,593) (222,242,176)
(170,665,409) (114,888,314) (87,042,006) (118,509,046) (140,599,896) (149,501,802) (142,350,711) (128,081,842) (59,593,125) (71,601,850) (621,894,059) (548,057,524) - - - - (1,222,145,206) (1,130,640,378)
Profit before taxation and unallocated
income and expenses 757,633,664 753,704,016 659,985,762 777,457,166 994,315,060 980,779,542 415,867,557 191,439,640 174,097,109 107,020,886 659,413,149 317,705,374 4,055,054 12,596,818 - - 3,665,367,355 3,140,703,442
Unallocated income and expenses

Other expenses (273,865,080) (129,114,178)
Other income 2,454,439,930 1,131,881,730
Finance cost (2,177,576,149) (1,383,364,854)
Taxation (500,774,516) (397,022,293)
Profit after taxation 3,167,591,540 2,363,083,847
36.1 Reconciliation of reportable segment assets and liabilities
Spinning Weaving
Processing and Home Textile Power Generation Total - Company
2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Rupees - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Total assets for reportable segments 5,796,050,374 4,791,339,137 7,084,061,568 5,856,081,167 8,586,741,295 7,098,280,203 3,472,236,683 3,648,412,131 1,453,603,100 665,508,402 6,093,660,854 7,398,669,445 1,964,682,284 1,930,215,818 34,451,036,158 31,388,506,303
Unallocated assets:
Long term investments 3,309,286,040 3,186,681,200
Other receivables 3,582,338,309 3,522,638,415
Short term investments 20,687,395 21,649,175
Cash and bank balances 17,728,377 76,444,854
Other corporate assets 2,126,867,175 1,197,678,639
Total assets as per statement of financial position 43,507,943,454 39,393,598,586
Total liabilities for reportable segments 216,855,786 113,068,028 265,045,960 138,194,257 321,267,830 167,508,190 151,202,138 181,814,877 63,298,650 101,640,336 1,112,511,384 967,188,195 371,589,632 383,772,367 2,501,771,380 2,053,186,250
Unallocated liabilities:
Long term financing 4,751,235,200 6,173,259,100
Accrued mark-up 431,379,587 211,095,682
Short term borrowings 20,091,978,160 17,021,991,856
Other corporate liabilities 393,140,685 223,616,347
Total liabilities as per statement of financial position 28,169,505,012 25,683,149,235
36.2 Geographical information
The Company's revenue from external customers by geographical location is detailed below:
2019 2018
Rupees Rupees
Europe 4,655,808,998 5,168,848,681
Asia, Africa and Australia 9,927,496,475 10,996,909,477
United States of America, Canada and South America 5,045,665,306 4,621,230,642
Pakistan 19,708,669,726 14,773,407,644
39,337,640,505 35,560,396,444
36.3 All non-current assets of the Company as at reporting dates are located and operating in Pakistan.
36.4 Revenue from major customers

The Company's revenue is earned from a large mix of customers.
36.5 Based on the judgment made by the management printing, dyeing and home textile operating segments of the Company have been aggregated into a single operating segment namely 'Processing and Home Textile' as these segments have similar economic characteristics in respect of nature of the products, nature of production process, type of
81
customers, method of distribution and nature of regulatory environment.
2019
2019 2018
37. PLANT CAPACITY AND ACTUAL PRODUCTION
Spinning
Number of spindles installed 222,708 222,708
Number of spindles worked 213,659 213,012
Capacity after conversion into 20/1 count (Kgs.) 79,402,488 78,969,801
Actual production of yarn after conversion into 20/1 count (Kgs.) 78,236,935 77,802,760
Under utilization of available capacity was due to normal maintenance and time lost in shifting of coarser counts to
finer counts and vice versa.
Weaving
Number of looms installed 363 363
Number of looms worked 363 363
Capacity after conversion into 50 picks - square yards 296,981,425 282,370,503
Actual production after conversion into 50 picks - square yards 251,830,349 240,664,380
Under utilization of available capacity was due to the following reasons:
- change of articles required
- higher count and cover factor
- due to normal maintenance
Power plant
Number of engines installed 17 17
Number of engines worked 17 17
Generation capacity (KWh) 343,830,000 343,830,000
Actual generation (KWh) 42,054,960 41,954,708
Under utilization of available capacity was due to normal maintenance and demand.
Dyeing
Number of thermosol dyeing machines 1 1
Number of stenters machines 4 4
Capacity in meters 36,500,000 36,500,000
Actual processing of fabrics - meters 30,038,558 29,769,648
Printing
Number of printing machines 1 1
Digital printing
Actual processing of fabrics - meters 1,451,740 796,820
Stitching
The plant capacity of this division is indeterminable due to multi product plant involving varying run length of order lots.
38. FINANCIAL RISK MANAGEMENT
38.1 Financial risk factors
The Company's activities expose it to a variety of financial risks: market risk (including currency risk, other price risk
and interest rate risk), credit risk and liquidity risk. The Company's overall risk management programme focuses on
the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company's financial
performance. The Company uses derivative financial instruments to hedge certain risk exposures.
Risk management is carried out by the Company's finance department under policies approved by the Board of
Directors. The Company's finance department evaluates and hedges financial risks. The Board provides principles for
overall risk management, as well as policies covering specific areas such as currency risk, other price risk, interest
rate risk, credit risk, liquidity risk, use of derivative financial instruments and non-derivative financial instruments and
investment of excess liquidity.
(a) Market risk
(i) Currency risk
Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in foreign exchange rates. Currency risk arises mainly from future commercial transactions or
receivables and payables that exist due to transactions in foreign currencies.
The Company is exposed to currency risk arising from various currency exposures, primarily with respect to the
United States Dollar (USD) and Euro. Currently, the Company's foreign exchange risk exposure is restricted to
bank balances, and the amounts receivable / payable from / to the foreign entities. The Company uses forward
exchange contracts to hedge its foreign currency risk, when considered appropriate. The Company's exposure
to currency risk was as follows:
2019 2018
Cash at banks - USD 46,573 96,093
Trade debts - USD 30,239,376 55,701,534
Trade debts - EURO 629,120 2,084,946
Trade and other payables - USD (7,718,853) (963,224)
Trade and other payables - EURO (1,172,826) (122,857)
Short term borrowings - USD 3,000,000 -
Accrued mark-up - USD 6,131 -
Net exposure - USD 25,573,227 54,834,403
Net exposure - EURO (543,706) 1,962,089
The following significant exchange rates were applied during the year:
Rupees per US Dollar
Average rate 137.29 110.43
Reporting date rate 164.00 121.40
Rupees per EURO
Sensitivity analysis
If the functional currency, at reporting date, had weakened / strengthened by 5% against the USD and Euro with all
other variables held constant, the impact on profit after taxation for the year would have been Rupees 194.402
million (2018: Rupees 325.846 million) respectively higher / lower, mainly as a result of exchange gains / losses
on translation of foreign exchange denominated financial instruments. Currency risk sensitivity to foreign
exchange movements has been calculated on a symmetric basis. In management's opinion, the sensitivity
analysis is unrepresentative of inherent currency risk as the year end exposure does not reflect the exposure
during the year.
(ii) Other price risk
Other price risk represents the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market prices (other than those arising from interest rate risk or currency risk), whether
those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting
all similar financial instrument traded in the market. The Company is not exposed to equity and commodity price risks.
(iii) Interest rate risk
This represents the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market interest rates.
The Company's interest rate risk arises mainly from long term financing, short term borrowings, investments at
amortized cost and short term loans to subsidiary companies. Borrowings obtained at variable rates expose the
Company to cash flow interest rate risk. Borrowings obtained at fixed rate expose the Company to fair value
interest rate risk.
At the reporting date the interest rate profile of the Company’s interest bearing financial instruments was:
2019 2018
Rupees Rupees
Fixed rate instruments
5,888,735,200 6,554,098,100
Financial assets
Sales tax refund bonds 222,604,840 -
Long term loans to employees 8,650,588 8,674,680
Net exposure (6,102,689,452) (6,545,423,420)
Floating rate instruments
Financial assets
Bank balances - saving accounts 2,375,121 1,755,880
Short term loans to subsidiary companies 1,272,569,696 508,168,820
1,295,605,043 530,584,926
18,954,478,160 16,641,152,856
Net exposure (17,658,873,117) (16,110,567,930)
Fair value sensitivity analysis for fixed rate instruments
The Company does not account for any fixed rate financial assets and liabilities at fair value through profit or loss.
Therefore, a change in interest rate at the reporting date would not affect profit or loss of the Company.
Cash flow sensitivity analysis for variable rate instruments
If interest rates at the year end date, fluctuates by 1% higher / lower with all other variables held constant, profit
after taxation for the year would have been Rupees 167.759 million (2018: Rupees 153.050 million) lower / higher,
mainly as a result of higher / lower interest expense on floating rate borrowings. This analysis is prepared
assuming the amounts of assets and liabilities outstanding at reporting dates were outstanding for the whole year.
(b) Credit risk
Credit risk represents the risk that one party to a financial instrument will cause a financial loss for the other party by
failing to discharge an obligation. The carrying amount of financial assets represents the maximum credit exposure.
The maximum exposure to credit risk at the reporting date was as follows:
2019 2018
Rupees Rupees
Trade debts 6,426,369,277 8,124,577,164
Loans and advances 1,304,151,256 532,203,597
Other receivables 438,750,231 340,470,982
Investments 243,292,235 21,649,175
Accrued interest 152,055,594 60,317,256
Bank balances 14,004,403 72,905,637
8,604,743,186 9,175,771,251
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (If
available) or to historical information about counterparty default rate:
Rating 2019 2018
Short Term Long term Agency Rupees Rupees
Banks
Al Baraka Bank (Pakistan) Limited A-1 A PACRA 370,656 634,655
Bank Alfalah Limited A-1+ AA+ PACRA 1,928,392 1,425,527
Bank Al-Habib Limited A-1+ AA+ PACRA 639,864
- 4,744,155
-
Dubai Islamic Bank (Pakistan) Limited A-1+ AA JCR-VIS 121,316 447,226
Faysal Bank Limited A-1+ AA PACRA 50,005 8,826,290
Habib Bank Limited A-1+ AAA JCR-VIS 1,892,143 25,625,494
Industrial and Commercial Bank of China Limited P-1 A1 Moody’s 2,334 2,334
JS Bank Limited A-1+ AA- PACRA 570,723
MCB Bank Limited A-1+ AAA PACRA 2,343,199 18,577,753
Meezan Bank Limited A-1+ AA+ JCR-VIS 1,928,594 8,416,590
National Bank of Pakistan A-1+ AAA PACRA 1,042,408 147,356
Samba Bank Limited A-1 AA JCR-VIS 34,436 1,778,095
Standard Chartered Bank (Pakistan) Limited A-1+ AAA PACRA 241,287 178,611
The Bank of Punjab A-1+ AA PACRA 48 -
United Bank Limited A-1+ AAA JCR-VIS 2,838,998 2,101,551
14,004,403 72,905,637
Investments
FBR Refund Settlement Company Limited - sales tax refund bonds Unknown 222,604,840 -
BankIslami Pakistan Limited A1 A+ PACRA 20,660,226 21,649,175
257,269,469 94,554,812
The Company's exposure to credit risk and allowance for expected credit losses related to trade debts is disclosed in Note 17.
Due to the Company's long standing business relationships with these counterparties and after giving due consideration to their strong
financial standing, management does not expect non-performance by these counter parties on their obligations to the Company.
Accordingly the credit risk is minimal.
(c) Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.
The Company manages liquidity risk by maintaining sufficient cash and the availability of funding through an adequate amount of
committed credit facilities. At 30 June 2019, the Company had Rupees 7,972 million (2018: Rupees 9,743 million) available borrowing
limits from financial institutions and Rupees 17.728 million (2018: Rupees 76.445 million) cash and bank balances. The management
believes the liquidity risk to be low. Following are the contractual maturities of financial liabilities, including interest payments. The amount
disclosed in the table are undiscounted cash flows:
Contractual maturities of financial liabilities as at 30 June 2019:
Carrying Contractual More than 2

6 month or less 6-12 month 1-2 Year
Amount cash flows Years
---------------------------------Rupees-----------------------------------
Non-derivative financial liabilities:
Long term financing 4,751,235,200 5,473,845,410 736,173,701 696,158,919 1,171,095,876 2,870,416,914

Short term borrowings 20,091,978,160 25,354,025,552 17,361,656,366 7,992,369,186 - -
Trade and other payables 2,525,300,414 2,525,300,414 2,525,300,414 - - -
Unclaimed dividend 52,301,675 52,301,675 52,301,675 - - -
Accrued mark-up 431,379,587 431,379,587 431,379,587 - - -
27,852,195,036 33,836,852,638 21,106,811,743 8,688,528,105 1,171,095,876 2,870,416,914

Carrying Contractual 6 months or More than 2
6-12 months 1-2 Year
Amount cash flows less Years
---------------------------------Rupees-----------------------------------
Long term financing 6,173,259,100 7,005,982,758 1,036,761,188 859,626,657 1,258,400,688 3,851,194,225
Accrued mark-up 211,095,682 211,095,682 211,095,682 - - -
25,494,791,091 26,562,901,222 18,231,666,894 3,221,639,415 1,258,400,688 3,851,194,225
The contractual cash flows relating to the above financial liabilities have been determined on the basis of interest rates / mark up rates
effective as at reporting date. The rates of interest / mark up have been disclosed in note 5 and note 8 to these financial statements.
38.2 Financial instruments by categories
Assets as per statement of financial position
2019 2018 2018
Loans and
Amortized cost FVTPL
receivables
Rupees Rupees Rupees

Long term security deposits 26,120,190 23,647,440 -
Trade debts 6,426,369,277 8,124,577,164 -
Loans and advances 1,304,151,256 532,203,597 -
Other receivables 438,750,231 331,977,621 8,493,361
Investments 243,292,235 21,649,175 -
Accrued interest 152,055,594 60,317,256 -
Cash and bank balances 17,728,377 76,444,854 -
8,608,467,160 9,170,817,107 8,493,361
2019 2019 2018

At amortized At amortized
FVTPL
cost cost
Rupees Rupees Rupees
Liabilities as per statement of financial position
Long term financing 4,751,235,200 - 6,173,259,100

Accrued mark-up 431,379,587 - 211,095,682
Short term borrowings 20,091,978,160 - 17,021,991,856
Unclaimed dividend 52,301,675 - 38,206,334
Trade and other payables 2,525,300,414 18,467,940 2,050,238,119
27,852,195,036 18,467,940 25,494,791,091
38.3 Offsetting financial assets and financial liabilities
As on reporting date, recognized financial instruments are not subject to off setting as there are no enforceable master netting
arrangements and similar agreements.
39. CAPITAL RISK MANAGEMENT

The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern in order to provide
returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order
to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, issue new shares or sell
assets to reduce debt. Consistent with others in the industry and the requirements of the lenders, the Company monitors the capital structure
on the basis of gearing ratio. This ratio is calculated as borrowings divided by total capital employed. Borrowings represent long term
financing and short term borrowings obtained by the Company as referred to in note 5 and note 8 respectively. Total capital employed
includes 'total equity' as shown in the statement of financial position plus 'borrowings'. The Company's strategy was to maintain a gearing ratio
of 65% debt and 35% equity (2018: 65% debt and 35% equity).
2019 2018
Borrowings Rupees 24,843,213,360 23,195,250,956
Total equity Rupees 15,338,438,442 13,710,449,351
Total capital employed Rupees 40,181,651,802 36,905,700,307
Gearing ratio Percentage 61.83 62.85

There is no significant change in gearing ratio.
40 RECOGNIZED FAIR VALUE MEASUREMENTS - FINANCIAL INSTRUMENTS
(i) Fair value hierarchy
Judgements and estimates are made in determining the fair values of the financial instruments that are recognised
and measured at fair value in these financial statements. To provide an indication about the reliability of the inputs
used in determining fair value, the Company has classified its financial instruments into the following three levels.
An explanation of each level follows underneath the table.
Recurring fair value measurements Level 1 Level 2 Level 3 Total

At 30 June 2019
------------------------------ Rupees ----------------------------
Derivative financial liabilities - 18,467,940 - 18,467,940
Total financial liabilities - 18,467,940 - 18,467,940

At 30 June 2018
------------------------------ Rupees ----------------------------
Financial assets
Derivative financial assets - 8,493,361 - 8,493,361
Total financial assets - 8,493,361 - 8,493,361
The above table does not include fair value information for financial assets and financial liabilities not measured at
fair value if the carrying amounts are a reasonable approximation of fair value. Due to short term nature, carrying
amounts of certain financial assets and financial liabilities are considered to be the same as their fair value. For the
majority of the non-current receivables, the fair values are also not significantly different to their carrying amounts.
There were no transfers between levels 1 and 2 for recurring fair value measurements during the year. Further,
there was no transfer in and out of level 3 measurements.
The Company’s policy is to recognize transfers into and transfers out of fair value hierarchy levels as at the end of
the reporting period.
Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and
trading and equity securities) is based on quoted market prices at the end of the reporting period. The quoted
market price used for financial assets held by the Company is the current bid price. These instruments are included
in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the-counter
derivatives) is determined using valuation techniques which maximise the use of observable market data and rely
as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are
observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included
in level 3. This is the case for unlisted equity securities.
(ii) Valuation techniques used to determine fair values

Specific valuation techniques used to value financial instruments include the use of quoted market prices or dealer
quotes for similar instruments.

41. UNUTILIZED CREDIT FACILITIES
The Company has total credit facilities amounting to Rupees 28,065 million (2018: Rupees 26,765 million) out of
which Rupees 7,972 million (2018: Rupees 9,743 million) remained unutilized at the end of the year.
42. EVENTS AFTER THE REPORTING PERIOD
42.1 The Board of Directors of the Company at their meeting held on October 04, 2019 has proposed cash
dividend of Rupees 2.5 per ordinary share (2018: Rupees 4.00 per ordinary share) in respect of the year
ended 30 June 2019. However, this event has been considered as non-adjusting events under IAS 10 'Events
after the Reporting Period' and has not been recognized in these financial statements.
42.2 Under Section 5A of the Income Tax Ordinance, 2001, a tax shall be imposed at the rate of 5% of accounting
profit before tax of the Company if it does not distribute at least 20% of its after tax profit for the year within six
months of the end of the year ended 30 June 2019 through cash. The requisite cash dividend has been
proposed by the Board of Directors of the Company in their meeting held October 04, 2019 and will be
distributed within the prescribed time limit. Therefore, the recognition of any income tax liability in this respect is
not considered necessary.
42.3 The members of the Company in their extra ordinary general meeting held on 31 August 2019 have approved to
purchase / buy-back upto a maximum of 32 million (13.32%) issued ordinary shares of the face value of Rupees
10 each of the Company at purchase price of Rupees 32 per share.
43. DATE OF AUTHORIZATION FOR ISSUE
These financial statements were authorized for issue on October 04, 2019 by the Board of Directors of
the Company.
44. PROVIDENT FUND
As at the reporting date, the Nishat (Chunian) Limited - Employees Provident Fund is in the process of
regularizing its investments in accordance with section 218 of the Companies Act, 2017 and the rules formulated
for this purpose in terms of SRO 731(I)/2018 issued by Securities and Exchange Commission of Pakistan on 06
June 2018 which allows transition period of three years for bringing the Employees Provident Fund Trust in
conformity with the requirements of rules.
45. CORRESPONDING FIGURES
Corresponding figures have been re-arranged, wherever necessary, for the purpose of comparison. However,
no significant rearrangements have been made.
46. GENERAL
Figures have been rounded off to nearest of Rupee.
____________________ _____________ ____________________________


PATTERN OF SHAREHOLDING
AS AT JUNE 30, 2019
Number of Shareholding Total Number of Percentage of

ShareHolders Shares Held Total Capital
From To
2498 1 100 52,926 0.02
1259 101 500 399,789 0.17
913 501 1000 753,779 0.31
1453 1001 5000 4,084,154 1.70
435 5001 10000 3,409,513 1.42
141 10001 15000 1,814,120 0.76
96 15001 20000 1,763,775 0.73
65 20001 25000 1,538,454 0.64
54 25001 30000 1,541,933 0.64
27 30001 35000 889,352 0.37
28 35001 40000 1,066,237 0.44
23 40001 45000 996,026 0.41
32 45001 50000 1,552,503 0.65
12 50001 55000 629,117 0.26
21 55001 60000 1,233,782 0.51
7 60001 65000 443,381 0.18
13 65001 70000 893,806 0.37
12 70001 75000 881,912 0.37
1 75001 80000 76,900 0.03
7 80001 85000 579,520 0.24
5 85001 90000 436,455 0.18
5 90001 95000 467,336 0.19
17 95001 100000 1,695,723 0.71
7 100001 105000 717,000 0.30
3 105001 110000 322,000 0.13
2 110001 115000 226,000 0.09
1 115001 120000 120,000 0.05
4 120001 125000 499,500 0.21
3 125001 130000 387,500 0.16
6 130001 135000 796,896 0.33
5 135001 140000 680,700 0.28
2 140001 145000 289,000 0.12
8 145001 150000 1,193,000 0.50
1 150001 155000 152,002 0.06
3 155001 160000 478,000 0.20
1 160001 165000 161,000 0.07
1 170001 175000 172,000 0.07
4 180001 185000 733,356 0.31
1 185001 190000 190,000 0.08
1 190001 195000 194,000 0.08
8 195001 200000 1,597,500 0.67
1 200001 205000 201,194 0.08
From To
2 205001 210000 414,000 0.17
2 210001 215000 425,500 0.18
1 215001 220000 218,500 0.09
1 220001 225000 225,000 0.09
1 225001 230000 226,000 0.09
2 230001 235000 466,500 0.19
2 245001 250000 497,200 0.21
1 250001 255000 251,000 0.10
2 260001 265000 525,770 0.22
1 275001 280000 275,500 0.11
2 280001 285000 561,800 0.23
1 285001 290000 286,000 0.12
2 295001 300000 600,000 0.25
1 305001 310000 310,000 0.13
1 315001 320000 315,550 0.13
1 320001 325000 323,000 0.13
1 335001 340000 338,000 0.14
2 345001 350000 700,000 0.29
1 350001 355000 353,500 0.15
1 355001 360000 360,000 0.15
1 380001 385000 385,000 0.16
2 395001 400000 800,000 0.33
1 400001 405000 401,500 0.17
1 410001 415000 414,500 0.17
1 425001 430000 427,500 0.18
1 610001 615000 614,000 0.26
1 625001 630000 629,406 0.26
1 640001 645000 640,603 0.27
1 660001 665000 660,500 0.27
1 690001 695000 690,716 0.29
3 745001 750000 2,250,000 0.94
2 765001 770000 1,539,500 0.64
1 800001 805000 802,500 0.33
1 865001 870000 865,500 0.36
1 900001 905000 905,000 0.38
1 940001 945000 943,000 0.39
1 985001 990000 985,450 0.41
2 995001 1000000 2,000,000 0.83
1 1000001 1005000 1,000,500 0.42
1 1070001 1075000 1,073,500 0.45
2 1080001 1085000 2,170,000 0.90
1 1085001 1090000 1,089,000 0.45

From To
1 1125001 1130000 1,130,000 0.47
1 1245001 1250000 1,250,000 0.52
2 1295001 1300000 2,600,000 1.08
1 1460001 1465000 1,464,000 0.61
1 1535001 1540000 1,536,758 0.64
1 1550001 1555000 1,554,750 0.65
1 1625001 1630000 1,629,603 0.68
1 2455001 2460000 2,458,014 1.02
1 2515001 2520000 2,515,016 1.05
1 2760001 2765000 2,761,500 1.15
1 3225001 3230000 3,229,633 1.34
1 3420001 3425000 3,421,974 1.42
1 4210001 4215000 4,213,300 1.75
1 4970001 4975000 4,973,500 2.07
1 5135001 5140000 5,139,064 2.14
1 5520001 5525000 5,521,868 2.30
1 5640001 5645000 5,644,999 2.35
1 5650001 5655000 5,651,500 2.35
1 5805001 5810000 5,807,791 2.42
1 6585001 6590000 6,588,047 2.74
1 8180001 8185000 8,180,719 3.41
1 8280001 8285000 8,284,000 3.45
1 8340001 8345000 8,343,914 3.47
1 11820001 11825000 11,822,562 4.92
1 20865001 20870000 20,866,776 8.69
1 48360001 48365000 48,360,632 20.13
7,269 <------Total------> 240,221,556 100.00

catEgories of shareholders
AS AT JUNE 30, 2019
NISHAT (CHUNIAN) LIMITED
CATEGORIES OF SHAREHOLDERS
AS ON JUNE 30, 2019
NO. OF TOTAL SHARES
CATEGORIES OF SHAREHOLDERS PERCENTAGE
SHAREHOLDERS HELD
A) Directors/Chief Executive Officer and their spouse and minor Children
Mr. Shahzad Saleem 1 48,360,632 20.13
Mrs. Farhat Saleem 2 12,395,838 5.16
Mr. Zain Shahzad 1 1,000,500 0.42
Mr. Farrukh Ifzal 1 500 0.00
Spouse:
Mrs. Ayesha Shahzad w/o Mr. Shahzad Saleem 2 238,448 0.10
TOTAL: - 6 61,995,918 25.81

B) Executives
N/A - - 0.00
C) Associated Companies, Undertakings and related parties 4 39,963,940 16.64
D) Public Sectors Companies & Corporations - -
E) NIT and IDBP (ICP UNIT) 4 5,617 0.00
Banks, Development Financial Institutions & Non-Banking Financial

F) 28 18,114,000 7.54
Institutions
H) Insurance Companies 9 5,508,214 2.29
I) Modarabas & Mutual Funds 33 16,670,680 6.94
J) *Shareholding 5% or more *3 93,445,808 38.90
K) Joint Stock Companies 128 9,031,457 3.76
L) Others 59 9,642,469 4.01
M) General Public 6,998 79,290,161 33.01
TOTAL: - 7,269 240,221,956 100.00
* Shareholders having 5% or above shares exist in other categories therefore not included in total.
Shareholding Detail of 5% or more

Name of Shareholder Shares held %
MRS. FARHAT SALEEM 12,395,838 5.16
MR. SHAHZAD SALEEM 48,360,632 20.13
NISHAT MILLS LIMITED 32,689,338 13.61
TOTAL :- 93,445,808 38.90
INFORMATION UNDER CLAUSE XIX(j) OF THE CODE OF CORPORATE GOVERNANCE

All trade in the Company’s shares, carried out by its Directors , CEO ,CFO, Company Secretary
and their spouses and minor children during the year July 01, 2018 to June 30, 2019:
Sale Purchase/ Gift in
Mrs. Farhat Saleem Nil (Gift in ) 6480176
Mr. Shahzad Saleem Nil 20,440,478
Mr. Zain Shahzad Nil 1,000,000

AND ITS SUBSIDIARY COMPANIES
CONSOLIDATED FINANCIAL STATEMENTS

WITH ACCOMPANYING INFORMATION
30 JUNE 2019

INDEPENDENT AUDITOR’S REPORT
To the members of Nishat (Chunian) Limited
Opinion
We have audited the annexed consolidated financial statements of Nishat (Chunian) Limited and its subsidiaries
(the Group), which comprise the consolidated statement of financial position as at 30 June 2019, and the
consolidated statement of profit or loss, the consolidated statement of comprehensive income, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended, and
notes to the consolidated financial statements, including a summary of significant accounting policies and other
explanatory information.
In our opinion, consolidated financial statements give a true and fair view of the consolidated financial position
of the Group as at 30 June 2019, and its consolidated financial performance and its consolidated cash flows for
the year then ended in accordance with the accounting and reporting standards as applicable in Pakistan.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of
the Consolidated Financial Statements section of our report. We are independent of the Group in accordance
with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants as
adopted by the Institute of the Chartered Accountants of Pakistan (the Code), and we have fulfilled our other
ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Emphasis of Matter
We draw attention to Note 20.5 to the consolidated financial statements, which describes the matter regarding
recoverability of certain trade debts. Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit
of the consolidated financial statements of the current period. These matters were addressed in the context of
our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Following are the Key audit matters:
No.
1. Inventory existence and valuation

Inventory of the textile business of the Group
represented a material position in the consolidated Our procedures over existence and valuation of
statement of financial position. inventory included, but were not limited to:
The textile business is characterized by high volumes

• To test the quantity of inventories at all
and the valuation and existence of inventories are
locations, we assessed the corresponding inventory
significant to the business. Therefore, considered as
observation instructions and participated in inventory
one of the key audit matters. counts on sites. Based on samples, we performed
test counts and compared the quantities counted by
Inventories are stated at lower of cost and net us with the results of the counts of the management.
No.
realizable value. Cost is determined as per • For a sample of inventory items, re-
accounting policy disclosed in Note 2.9 to the performed the weighted average cost calculation
consolidated financial statements. and compared the weighted average cost appearing
on valuation sheets.
At year end, the valuation of inventory is reviewed • We tested that the ageing report used by
by management and the cost of inventory is reduced management correctly aged inventory items by
where inventory is forecast to be sold below cost. agreeing a sample of aged inventory items to the
last recorded invoice.
Useable stores, spares parts and loose tools and • On a sample basis, we tested the net
raw materials are valued at weighted average cost, realizable value of inventory items to recent selling
whereas, costing of work-in-process and finished prices and re-performed the calculation of the
goods is considered to carry more significant risk inventory write down, if any.
as the cost of material, labor and manufacturing • We assessed the percentage write down
overheads is allocated on the basis of complex applied to older inventory with reference to historic
formulas and involves management judgment. inventory write downs and recoveries on slow
moving inventory.
The determination of whether inventory will • In the context of our testing of the calculation,
be realised for a value less than cost requires we analysed individual cost components and
management to exercise judgement and apply traced them back to the corresponding underlying
assumptions. Management undertake the following documents. We furthermore challenged changes in
procedures for determining the level of write down unit costs.
required: • We also made enquires of management,
including those outside of the finance function,
• Use inventory ageing reports together and considered the results of our testing above to
with historical trends to estimate the likely future determine whether any specific write downs were
saleability of slow moving and older inventory items. required.
• Perform a line-by-line analysis of remaining
inventory to ensure it is stated at the lower of cost
and net realisable value and a specific write down is
recognized, if required.
For further information on inventory, refer to the

following:
- Summary of significant accounting policies,

Inventories note 2.9 to the consolidated financial
statements.
- Stores, spare parts and loose tools note
18 and stock-in-trade note 19 to the consolidated
2. Revenue recognition Our procedures included, but were not limited to:
• We obtained an understanding of the
We identified recognition of revenue of textile process relating to recognition of revenue and
business of the Group as a key audit matter because testing the design, implementation and operating
revenue is one of the key performance indicator and effectiveness of key internal controls over recording
gives rise to an inherent risk that revenue could be of revenue;
subject to misstatement to meet expectations or • We compared a sample of revenue
targets. transactions recorded during the year with sales
orders, sales invoices, delivery documents and
other relevant underlying documents;
For further information, refer to the following: • We compared a sample of revenue
transactions recorded around the year-end with the
- Summary of significant accounting policies, sales orders, sales invoices, delivery documents and
Revenue from contracts with customers note 2.15 to other relevant underlying documentation to assess if
the financial statements. the related revenue was recorded in the appropriate
- Revenue note 26 to the financial statements. accounting period;

No.
• We assessed whether the accounting
policies for revenue recognition complies with the
requirements of IFRS 15 ‘Revenue from Contracts
with Customers’; and
• We compared the details of a sample of
journal entries posted to revenue accounts during
the year, which met certain specific risk-based
criteria, with the relevant underlying documentation.
We also considered the appropriateness of

disclosures in the consolidated financial statements.
Information Other than the Financial Statements and Auditor’s Report Thereon
Management is responsible for the other information. The other information comprises the information included
in the annual report, but does not include the consolidated financial statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and the Board of Directors for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements in
accordance with accounting and reporting standards as applicable in Pakistan and Companies Act, 2017 and
for such internal control as management determines is necessary to enable the preparation of consolidated
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or
has no realistic alternative but to do so.
The Board of Directors is responsible for overseeing the Group’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as
a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs as applicable in Pakistan will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis
of these consolidated financial statements.
As part of an audit in accordance with ISAs as applicable in Pakistan, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including
the disclosures, and whether the consolidated financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.
We also provide the Board of Directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of most
significance in the audit of the consolidated financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is Syed Mustafa Ali.
RIAZ AHMAD & COMPANY

Chartered Accountants
Lahore

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2019
2019 2018
Note Rupees Rupees
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorized share capital 3 3,000,000,000 3,000,000,000
Issued, subscribed and paid-up share capital 4 2,402,215,560 2,402,215,560

Reserves 5 18,039,573,965 15,679,647,437
Equity attributable to equity holders of the Holding Company 20,441,789,525 18,081,862,997
Non-controlling interest 7,018,945,192 5,976,634,360
Total equity 27,460,734,717 24,058,497,357
LIABILITIES
NON-CURRENT LIABILITIES
Long term financing 6 5,818,617,415 10,481,386,830

Deferred revenue 7 - 2,972,000
5,818,617,415 10,484,358,830
CURRENT LIABILITIES
Trade and other payables 9 4,064,627,697 3,178,485,746

Accrued mark-up / profit 10 930,241,729 570,404,272
Short term borrowings 11 31,443,299,687 25,510,180,650
Unclaimed dividend 183,500,761 53,705,334
Current portion of non-current liabilities 12 4,615,738,167 4,675,185,917
41,237,408,041 33,987,961,919
Total liabilities 47,056,025,456 44,472,320,749
CONTINGENCIES AND COMMITMENTS 13
TOTAL EQUITY AND LIABILITIES 74,516,760,173 68,530,818,106

The annexed notes form an integral part of these consolidated financial statements.
____________________ _______________
CHIEF EXECUTIVE DIRECTOR
2019 98 Nishat
Nishat (Chunian)
(Chunian) Limited
Limited and its subsidiaries
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2019
2019 2018
Note Rupees Rupees
ASSETS
NON-CURRENT ASSETS
Fixed assets 14 27,401,662,686 28,359,395,549

Intangible assets 15 9,199,454 19,714,770
Long term investment 16 222,604,840 -
Long term loans to employees 17 18,964,295 17,897,227
Deferred income tax asset 8 - 8,793,557
27,678,656,465 28,429,553,543
CURRENT ASSETS
Stores, spare parts and loose tools 18 1,640,861,089 1,364,302,917

Stock-in-trade 19 18,074,711,590 12,756,423,851
Trade debts 20 21,008,395,745 19,204,333,280
Loans and advances 21 1,585,514,548 1,619,392,876
Short term deposits and prepayments 22 40,015,342 30,497,543
Other receivables 23 4,275,759,264 4,841,867,825
Short term investments 24 31,242,590 32,179,691
Cash and bank balances 25 181,603,540 252,266,580
46,838,103,708 40,101,264,563
TOTAL ASSETS 74,516,760,173 68,530,818,106
____________________________
CHIEF FINANCIAL OFFICER
Nishat (Chunian) Limited and its subsidiaries

CONSOLIDATED STATEMENT OF PROFIT OR LOSS
2019 2018
Note Rupees Rupees
REVENUE 26 54,988,471,178 53,033,447,870
COST OF SALES 27 (44,708,960,782) (43,746,611,007)

GROSS PROFIT 10,279,510,396 9,286,836,863
DISTRIBUTION COST 28 (1,006,899,746) (968,232,967)

ADMINISTRATIVE EXPENSES 29 (536,380,341) (483,225,873)
OTHER EXPENSES 30 (502,086,236) (170,755,814)
(2,045,366,323) (1,622,214,654)
8,234,144,073 7,664,622,209
OTHER INCOME 31 1,710,316,148 888,130,215
PROFIT FROM OPERATIONS 9,944,460,221 8,552,752,424
FINANCE COST 32 (3,830,831,920) (2,712,197,173)

PROFIT BEFORE TAXATION 6,113,628,301 5,840,555,251
TAXATION 33 (535,162,099) (369,490,920)
PROFIT ATTRIBUTABLE TO:
EQUITY HOLDERS OF THE HOLDING COMPANY 3,906,991,453 3,804,150,810

NON-CONTROLLING INTEREST 1,671,474,749 1,666,913,521
5,578,466,202 5,471,064,331
EARNINGS PER SHARE - BASIC AND DILUTED 34 16.26 15.84
_________________ _____________ ___________________________

2019 100 Nishat

Nishat (Chunian)
(Chunian) Limited
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2019 2018
Rupees Rupees
OTHER COMPREHENSIVE LOSS
Items that will not be reclassified to profit or loss - -
Items that may be reclassified subsequently to profit or loss:
Exchange difference on translation of foreign operations (7,462,476) (5,642,933)
Other comprehensive loss for the year (7,462,476) (5,642,933)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 5,571,003,726 5,465,421,398
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO:
EQUITY HOLDERS OF THE HOLDING COMPANY 3,899,528,977 3,798,507,877

NON-CONTROLLING INTEREST 1,671,474,749 1,666,913,521
5,571,003,726 5,465,421,398
____________________ _____________ ___________________________


CONSOLIDATED STATEMENT OF CASH FLOWS
2019 2018
Note Rupees Rupees
CASH FLOWS FROM OPERATING ACTIVITIES
Cash generated from operations 35 5,685,103,886 3,151,577,483

Net increase in long term security deposits (2,472,750) (1,413,000)
Finance cost paid (3,468,383,922) (2,648,590,445)
Income tax paid (346,019,099) (259,472,863)
Net (increase) / decrease in long term loans to employees (1,770,467) 2,822,296
Net cash generated from operating activities 1,866,457,648 244,923,471
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditure on property, plant and equipment (1,666,780,479) (950,075,988)
Capital expenditure on intangible assets - (3,480,645)
Investment made (222,604,840) -
Proceeds from sale of operating fixed assets 9,679,755 49,975,387
Proceeds from sale of shares of Subsidiary Company - net 301,983,650 -
Interest received 8,008,958 3,650,313
Net cash used in investing activities (1,569,712,956) (899,930,933)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long term financing - 2,276,300,000
Repayment of long term financing (4,547,217,165) (4,813,391,722)
Short term borrowings - net 6,007,858,957 4,035,423,732
Dividend paid to non-controlling interest (629,163,917) (179,761,119)
Dividends paid (1,191,423,131) (652,708,350)
Net cash (used in) / generated from financing activities (359,945,256) 665,862,541
Net (decrease) / increase in cash and cash equivalents (63,200,564) 10,855,079
Impact of exchange translation (7,462,476) (5,642,933)
Cash and cash equivalents at the beginning of the year 252,266,580 247,054,434
Cash and cash equivalents at the end of the year 181,603,540 252,266,580
____________________ ______________ ___________________________

2019 102 Nishat

Nishat (Chunian)
(Chunian) Limited
CONSOLIDATED STATEMENT OF CHANGE IN EQUITY
ATTRIBUTABLE TO EQUITY HOLDERS OF THE HOLDING COMPANY

CAPITAL RESERVES REVENUE RESERVES NON-
SHAREHOLDERS' CONTROLLING TOTAL EQUITY
SHARE CAPITAL Exchange TOTAL RESERVES
Share Unappropriated EQUITY INTEREST
translation General reserve Total
premium profit
reserve
----------------------------------------------------- Rupees-------------------------------------------------------
Balance as at 30 June 2017 2,402,215,560 (1,036,004) 600,553,890 1,629,221,278 10,313,009,675 11,942,230,953 12,541,748,839 14,943,964,399 4,489,481,958 19,433,446,357
Final dividend for the year ended 30 June 2017 @ Rupees 2.75
per ordinary share - - - - (660,609,279) (660,609,279) (660,609,279) (660,609,279) - (660,609,279)
Dividend to non-controlling interest - - - - - - - - (179,761,119) (179,761,119)

- - - - (660,609,279) (660,609,279) (660,609,279) (660,609,279) (179,761,119) (840,370,398)
Profit for the year - - - - 3,804,150,810 3,804,150,810 3,804,150,810 3,804,150,810 1,666,913,521 5,471,064,331
Other comprehensive loss for the year - (5,642,933) - - - - (5,642,933) (5,642,933) - (5,642,933)
Total comprehensive income for the year - (5,642,933) - - 3,804,150,810 3,804,150,810 3,798,507,877 3,798,507,877 1,666,913,521 5,465,421,398
Adjustment on adoption of IFRS 9 (Note 2.8) - - - - (5,288,510) (5,288,510) (5,288,510) (5,288,510) - (5,288,510)
Adjustment on adoption of IFRS 15 (Note 2.15) - - - - (213,095,381) (213,095,381) (213,095,381) (213,095,381) - (213,095,381)
Adjusted total equity as at 01 July 2018 2,402,215,560 (6,678,937) 600,553,890 1,629,221,278 13,238,167,315 14,867,388,593 15,461,263,546 17,863,479,106 5,976,634,360 23,840,113,466
Final dividend for the year ended 30 June 2018 @ Rupees 4 per
ordinary share - - - - (960,886,224) (960,886,224) (960,886,224) (960,886,224) - (960,886,224)
Interim dividend for the year ended 30 June 2019 @ Rupees
1.50 per ordinary share - - - - (360,332,334) (360,332,334) (360,332,334) (360,332,334) - (360,332,334)
Dividend to non-controlling interest - - - - - - - - (629,163,917) (629,163,917)
- - - - (1,321,218,558) (1,321,218,558) (1,321,218,558) (1,321,218,558) (629,163,917) (1,950,382,475)
Profit for the year - - - - 3,906,991,453 3,906,991,453 3,906,991,453 3,906,991,453 1,671,474,749 5,578,466,202
Other comprehensive loss for the year - (7,462,476) - - - - (7,462,476) (7,462,476) - (7,462,476)
Total comprehensive income for the year - (7,462,476) - - 3,906,991,453 3,906,991,453 3,899,528,977 3,899,528,977 1,671,474,749 5,571,003,726

Nishat (Chunian)
____________________ ______________ ____________________________
103
2019 Limited
and its subsidiaries
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. THE GROUP AND ITS OPERATIONS
The Group consists of:
Holding Company
• Nishat (Chunian) Limited
Subsidiary Companies
• Nishat Chunian Power Limited

• Nishat Chunian USA Inc.
• NC Electric Company Limited
Nishat (Chunian) Limited (“the Holding Company”) is a public limited company incorporated in Pakistan under the re-
pealed Companies Ordinance, 1984 (Now Companies Act, 2017) and is listed on Pakistan Stock Exchange Limited.
Its registered office is situated at 31-Q, Gulberg II, Lahore. The Holding Company is engaged in business of spinning,
weaving, dyeing, printing, stitching, processing, doubling, sizing, buying, selling and otherwise dealing in yarn, fabrics
and made-ups made from raw cotton, synthetic fibre and cloth and to generate, accumulate, distribute, supply and sell
electricity.
Nishat Chunian Power Limited
Nishat Chunian Power Limited is a public limited company incorporated in Pakistan under the repealed Companies
Ordinance, 1984 (Now Companies Act, 2017) and listed on the Pakistan Stock Exchange Limited. The principal activity
of Nishat Chunian Power Limited is to build, own, operate and maintain a fuel fired power station having gross capac-
ity of 200 MW and net capacity of 195.722 MW at Jamber Kalan, Tehsil Pattoki, District Kasur, Punjab, Pakistan. Its
registered office is situated at 31-Q, Gulberg II, Lahore. Nishat Chunian Power Limited has commenced commercial
operations from 21 July 2010 and the twenty five years term of the Power Purchase Agreement (PPA) with National
Transmission and Despatch Company Limited (NTDCL) starts from this date. Ownership interest held by non-control-
ling interests in Nishat Chunian Power Limited is 48.93% (2018: 48.93%).
Nishat Chunian USA Inc.
Nishat Chunian USA Inc. is a foreign subsidiary incorporated under the Business Corporation Laws of the State of
New York. The registered office of Nishat Chunian USA Inc. is situated at 230 Fifth Avenue, Suite 1406, New York, NY
10001, USA. The principal business of the Nishat Chunian USA Inc. is to import home textile products and distribute
to local retailers.
NC Electric Company Limited
NC Electric Company Limited is a public limited company incorporated in Pakistan on 18 April 2014 under the repealed
Companies Ordinance, 1984 (Now Companies Act, 2017). NC Electric Company Limited is a wholly owned subsidiary
of Nishat (Chunian) Limited. Its registered office is situated at 31-Q, Gulberg II, Lahore. The principal objects of NC
Electric Company Limited are to develop, own and operate a 46 MW and 8 TPH process steam coal fired electric power
generation project at 49 KM, Multan Road, near Bhai Phero, District Kasur. NC Electric Company Limited commenced
commercial operations from 01 May 2017.
2019 104 Nishat

Nishat (Chunian)
(Chunian) Limited
Disposal of investment in shares of NC Entertainment (Private) Limited
In order to concentrate on the core business, the board of directors of the Holding Company in their meeting held on
24 July 2018 and subsequently the shareholders of the Holding Company in their Extra Ordinary General Meeting held
on 20 August 2018 approved the sale of NC Entertainment (Private) Limited - wholly owned subsidiary company, to
the highest bidder (Mr. Shahmir Yahya, a related party at that time). Total agreed consideration received on disposal of
investment in shares of subsidiary company was Rupees 322 million.
1.2 Geographical location and addresses of all business units are as follows:
Sr. No. Business units and office Address
Manufacturing units:
1 Spinning Units 1, 4, 5, 7 and 8. 49th Kilometre, Multan Road, Bhai Pheru, Tehsil Chunian,
District Kasur.
2 Spinning Units 2, 3, 6 and Weaving. 49th Kilometre, Multan Road, Kamogal, Tehsil Pattoki, District
Kasur.
3 Dyeing, Printing and Stitching. 4th Kilometre, Manga Road, Raiwind.
4 Power Plant 49 KM, Multan Road, Bhai Pheru, District Kasur.
5 Power Plant Jamber Kalan, Tehsil Pattoki, District Kasur.
Office 31-Q, Gulberg-II, Lahore, Pakistan.
Office - USA 230 Fifth Avenue, Suite 1406, New York, NY 10001.
Retail stores
The Linen Company (TLC) – I Outlet No 9-10, 2nd Floor, Gulberg Galleria Mall, Lahore
The Linen Company (TLC) – II Shop No. 008, 2nd Floor, Packages Mall, Lahore
The Linen Company (TLC) – III Outlet No. 21-22, Lower Ground Floor, WTC Giga Mall, DHA
Phase 2, Islamabad
The Linen Company (TLC) – IV Shop No. 45, 3rd Floor, Centaurus Mall, Islamabad
The Linen Company (TLC) – V Shop No. G-14, Ground Floor Ocean Mall, Clifton, Karachi
1.3 Significant restrictions
Cash and bank balances held in foreign country are subject to local exchange control regulations. These regulations
provide for restrictions on exporting capital from these countries, other than through normal dividends. The carrying
amount of these assets included within the consolidated financial statements to which these restrictions apply is Ru-
pees 13.233 million (2018: Rupees 0.047 million).
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies applied in the preparation of these consolidated financial statements are set out
below. These policies have been consistently applied to all years presented, unless otherwise stated:
2.1 Basis of preparation
a) Statement of compliance
These consolidated financial statements have been prepared in accordance with the accounting and reporting stand-
ards as applicable in Pakistan. The accounting and reporting standards applicable in Pakistan comprise of:
- International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board
(IASB) as notified under the Companies Act, 2017; and
- Provisions of and directives issued under the Companies Act, 2017.
Where provisions of and directives issued under the Companies Act, 2017 differ from the IFRSs, the provisions of and
directives issued under the Companies Act, 2017 have been followed.
b) Accounting convention
These consolidated financial statements have been prepared under the historical cost convention except for the certain
financial instruments carried at fair value.
c) Critical accounting estimates and judgments
The preparation of these consolidated financial statements in conformity with the approved accounting standards re-
quires the use of certain critical accounting estimates. It also requires the management to exercise its judgment in the
process of applying the accounting policies. Estimates and judgments are continually evaluated and are based on his-
torical experience, including expectation of future events that are believed to be reasonable under the circumstances.
The areas where various assumptions and estimates are significant to the consolidated financial statements or where
judgments were exercised in application of accounting policies are as follows:
Financial instruments – fair value
The fair value of financial instruments that are not traded in an active market is determined by using valuation tech-
niques based on assumptions that are dependent on conditions existing at the reporting date.
Useful lives, patterns of economic benefits and impairments
Estimates with respect to residual values and depreciable lives and pattern of flow of economic benefits are based on
the analysis of the management. Further, the Group reviews the values of assets for possible impairments on an annual
basis. Any change in the estimates in the future might affect the carrying amount of respective item of property, plant
and equipment, with a corresponding effect on the depreciation charge and impairment.
Inventories
Net realizable value of inventories is determined with reference to currently prevailing selling prices less estimated
expenditure to make sales.
The provision for accumulating compensated absences is made by the Holding Company on the basis of accumulated
leave balance on account of employees.
Income tax
In making the estimates for income tax currently payable, the management takes into account the current income tax
law and the decisions of appellate authorities on certain issues in the past.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the
lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected
credit loss rate for each group. These assumptions include recent sales experience and historical collection rates.
Revenue from contracts with customers involving sale of goods
When recognizing revenue in relation to the sale of goods to customers, the key performance obligation of the Group is
considered to be the point of delivery of the goods to the customer, as this is deemed to be the time that the customer
obtains control of the promised goods and therefore the benefits of unimpeded access.
d) Standards, interpretations and amendments to published approved accounting standards that are ef-
fective in current year and are relevant to the Group
2019 106 Nishat
Nishat (Chunian)
(Chunian) Limited
Following standards, interpretations and amendments to published approved accounting standards are mandatory for
the Group’s accounting periods beginning on or after 01 July 2018:
• IFRS 9 ‘Financial Instruments’

• IFRS 15 ‘Revenue from Contracts with Customers’
• IFRS 15 (Amendments), ‘Revenue from Contracts with Customers
• IFRIC 22 ‘Foreign Currency Transactions and Advance Consideration’
• Annual Improvements to IFRSs: 2014 – 2016 Cycle
The Group had to change its accounting policies and make certain adjustments without restating prior year results fol-
lowing the adoption of IFRS 9 and IFRS 15. These are disclosed in note 2.8 and note 2.15. Most of the other amend-
ments listed above did not have any impact on the amounts recognised in prior periods and are not expected to signifi-
cantly affect the current or future periods.
e) Standards, interpretations and amendments to published approved accounting standards that are not
yet effective but relevant to the Group
Following standards, interpretations and amendments to existing standards have been published and are mandatory
for the Group’s accounting periods beginning on or after 01 July 2019 or later periods:
IFRS 16 ‘Leases’ (effective for annual periods beginning on or after 01 January 2019). IFRS 16 specifies how an entity
will recognize, measure, present and disclose leases. The standard provides a single lessee accounting model, requir-
ing lessees to recognize assets and liabilities for all leases unless the lease term is 12 months or less or the underlying
asset has a low value. Lessors continue to classify leases as operating or finance, with IFRS 16 approach to lessor
accounting substantially unchanged from its predecessor, IAS 17 ‘Leases’. IFRS 16 replaces IAS 17 ‘Leases’, IFRIC 4
‘Determining Whether an Arrangement Contains a Lease’, SIC-15 ‘Operating Leases–Incentives’ and SIC-27 ‘Evalu-
ating the Substance of Transactions Involving the Legal Form of a Lease’. The management of the Group is in the
process of evaluating the impacts of the aforesaid standard on the Group’s financial statements.
Amendments to IFRS 9 (effective for annual periods beginning on or after 01 January 2019) clarify that for the purpose
of assessing whether a prepayment feature meets the solely payments of principal and interest (‘SPPI’) condition, the
party exercising the option may pay or receive reasonable compensation for the prepayment irrespective of the reason
for prepayment. In other words, prepayment features with negative compensation do not automatically fail SPPI. The
amendments are not likely to have significant impact on the Group’s financial statements.
IAS 28 (Amendments) ‘Investments in Associates and Joint Ventures’ (effective for annual periods beginning on or
after 01 January 2019). The IASB has clarified that IFRS 9, including its impairment requirements, applies to long-term
interests. Furthermore, in applying IFRS 9 to long-term interests, an entity does not take into account adjustments to
their carrying amount required by IAS 28 (i.e., adjustments to the carrying amount of long-term interests arising from
the allocation of losses of the investee or assessment of impairment in accordance with IAS 28). The amendments are
not likely to have significant impact on the Group’s financial statements.
IFRIC 23 ‘Uncertainty over Income Tax Treatments’ (effective for annual periods beginning on or after 01 January
2019). The interpretation addresses the determination of taxable profit (tax loss), tax bases, unused tax losses, unused
tax credits and tax rates, when there is uncertainty over income tax treatments under IAS 12 ‘Income Taxes’. It specifi-
cally considers: whether tax treatments should be considered collectively; assumptions for taxation authorities’ exami-
nations; the determination of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates;
and the effect of changes in facts and circumstances. The interpretation is not expected to have a material impact on
the Group’s financial statements.
Amendments to IFRS 10 ‘Consolidated Financial Statements’ and IAS 28 (deferred indefinitely) to clarify the treatment
of the sale or contribution of assets from an investor to its associates or joint venture, as follows: require full recognition
in the investor’s financial statements of gains and losses arising on the sale or contribution of assets that constitute
a business (as defined in IFRS 3 ‘Business Combinations’); require the partial recognition of gains and losses where
the assets do not constitute a business, i.e. a gain or loss is recognized only to the extent of the unrelated investors’
interests in that associate or joint venture. These requirements apply regardless of the legal form of the transaction, e.g.
whether the sale or contribution of assets occur by an investor transferring shares in a subsidiary that holds the assets
(resulting in loss of control of the subsidiary), or by the direct sale of the assets themselves. The management of the
Group is in the process of evaluating the impacts of the aforesaid amendments on the Group’s financial statements.
Amendments to IFRS 3 ‘Business Combinations’ (effective for annual periods beginning on or after 01 January 2020).
The International Accounting Standards Board (IASB) has issued ‘Definition of Business’ aimed at resolving the difficul-
ties that arise when an entity determines whether it has acquired a business or a group of assets. The amendments
clarify that to be considered a business, an acquired set of activities and assets must include, at a minimum, an input
and a substantive process that together significantly contribute to the ability to create outputs. The amendments include
an election to use a concentration test. The standard is effective for transactions in the future and therefore would not
have an impact on past consolidated financial statements.
Amendments to IAS 1 ‘Presentation of Financial Statements’ and IAS 8 ‘Accounting Policies, Changes in Account-
ing Estimates and Errors’ (effective for annual periods beginning on or after 01 January 2020). The amendments are
intended to make the definition of material in IAS 1 easier to understand and are not intended to alter the underlying
concept of materiality in IFRS. In addition, the IASB has also issued guidance on how to make materiality judgements
when preparing general purpose financial statements in accordance with IFRS.
On 12 December 2017, IASB issued Annual Improvements to IFRSs: 2015 – 2017 Cycle, incorporating amendments to
four IFRSs more specifically in IFRS 3 ‘Business Combinations’, IFRS 11 ‘Joint Arrangements’, IAS 12 ‘Income Taxes’
and IAS 23 ‘Borrowing Costs’. The amendments are effective for annual periods beginning on or after 01 January 2019.
The amendments have no significant impact on the Group’s financial statements and have therefore not been analyzed
in detail.
On 29 March 2018, the International Accounting Standards Board (the IASB) has issued a revised Conceptual Frame-
work. The new Framework: reintroduces the terms stewardship and prudence; introduces a new asset definition that
focuses on rights and a new liability definition that is likely to be broader than the definition it replaces, but does not
change the distinction between a liability and an equity instrument; removes from the asset and liability definitions
references to the expected flow of economic benefits–this lowers the hurdle for identifying the existence of an asset
or liability and puts more emphasis on reflecting uncertainty in measurement; discusses historical cost and current
value measures, and provides some guidance on how the IASB would go about selecting a measurement basis for a
particular asset or liability; states that the primary measure of financial performance is profit or loss, and that only in
exceptional circumstances will the IASB use other comprehensive income and only for income or expenses that arise
from a change in the current value of an asset or liability; and discusses uncertainty, derecognition, unit of account,
the reporting entity and combined financial statements. The Framework is not an IFRS standard and does not override
any standard, so nothing will change in the short term. The revised Framework will be used in future standard-setting
decisions, but no changes will be made to current IFRS. Preparers might also use the Framework to assist them in
developing accounting policies where an issue is not addressed by an IFRS. It is effective for annual periods beginning
on or after 1 January 2020 for preparers that develop an accounting policy based on the Framework.
f) Standards and amendments to approved published standards that are not yet effective and not consid-
ered relevant to the Group
There are other standards and amendments to published standards that are mandatory for accounting periods begin-
ning on or after 01 July 2019 but are considered not to be relevant or do not have any significant impact on the Group’s
financial statements and are therefore not detailed in these consolidated financial statements.
g) Exemption from applicability of certain interpretations to standards
Securities and Exchange Commission of Pakistan (SECP) through SRO 24(I)/2012 dated 16 January 2012, has ex-
empted the application of International Financial Reporting Interpretations Committee (IFRIC) 4 ‘Determining whether
an Arrangement contains a Lease’ to all companies. However, the SECP made it mandatory to disclose the impact
of the application of IFRIC 4 on the results of the companies. This interpretation provides guidance on determining
whether arrangements that do not take the legal form of a lease should, nonetheless, be accounted for as a lease in
accordance with International Accounting Standard (IAS) 17 ‘Leases’.
Consequently, Nishat Chunian Power Limited – Subsidiary Company is not required to account for a portion of its Pow-
2019 108 Nishat

Nishat (Chunian)
(Chunian) Limited
er Purchase Agreement (PPA) with National Transmission and Dispatch Company Limited (NTDCL) as a lease under
IAS 17 ‘Leases’. If the aforesaid Subsidiary Company were to follow IFRIC 4 and IAS 17, the effect on the consolidated
financial statements would be as follows:
2019 2018
Rupees Rupees

De-recognition of property, plant and equipment (11,167,862,000) (11,339,436,000)
De-recognition of trade debts (5,880,475,000) (2,777,269,000)
Recognition of lease debtor 12,567,265,000 8,960,423,000
Decrease in un-appropriated
profit at the beginning of the year (2,379,012,000) (1,028,916,000)
Decrease in profit for the year (2,102,060,000) (1,350,097,000)
Decrease in un-appropriated profit at the end of the year (4,481,072,000) (2,379,013,000)
2.2 Consolidation
a) Subsidiaries
Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed
to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through
its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is trans-
ferred to the Group. They are deconsolidated from the date that control ceases.
The assets and liabilities of the subsidiary companies have been consolidated on a line by line basis and the carrying
value of investments held by the Holding Company is eliminated against the Holding Company’s share in paid up capi-
tal of the subsidiary companies.
Intra group balances and transactions have been eliminated.

Non-controlling interest is that part of net results of the operations and of net assets of the subsidiary companies at-
tributable to interest which is not owned by the Holding Company. Non-controlling interest is presented as a separate
item in the consolidated financial statements.
b) Translation of the financial statements of foreign subsidiary
The financial statements of foreign subsidiary of which the functional currency is different from that used in preparing
the Group’s consolidated financial statements are translated in functional currency of the Group. Statement of financial
position items are translated at the exchange rate at the reporting date and statement of profit or loss items are con-
verted at the average rate for the period. Any resulting translation differences are recognized under exchange transla-
tion reserve in consolidated reserves.
2.3 Taxation
Current
Provision for current tax is based on the taxable income for the year determined in accordance with the prevailing law
for taxation of income. The charge for current tax is calculated using prevailing tax rates or tax rates expected to apply
to the profit for the year if enacted. The charge for current tax also includes adjustments, where considered necessary,
to provision for tax made in previous years arising from assessments framed during the year for such years.
The profits and gains of Nishat Chunian Power Limited – Subsidiary Company and NC Electric Company Limited –
Subsidiary Company from electric power generation are exempt from tax under clause (132), Part I of the Second
Schedule to the Income Tax Ordinance, 2001, subject to the conditions and limitations provided therein. The aforesaid
Subsidiary Companies are also exempt from minimum tax on turnover (sale of electricity) under clause 11A(v), Part
IV of the Second Schedule to the Income Tax Ordinance, 2001. However, full provision is made in the consolidated
statement of profit or loss on income from sources not covered under the above clause at current rates of taxation after
taking into account, tax credits and rebates available, if any.

Provision for income tax on the income of foreign subsidiary – Nishat Chunian USA Inc. is computed in accordance with
the tax legislation in force in the country where the income is taxable.
Deferred
Deferred tax is accounted for using the liability method in respect of all temporary differences arising from differences
between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax
bases used in the computation of the taxable profit. Deferred tax liabilities are generally recognized for all taxable tem-
porary differences and deferred tax assets to the extent that it is probable that taxable profits will be available against
which the deductible temporary differences, unused tax losses and tax credits can be utilized.
Deferred tax is calculated at the rates that are expected to apply to the period when the differences reverse based on
tax rates that have been enacted or substantively enacted by the reporting date. Deferred tax is charged or credited
in the consolidated statement of profit or loss, except to the extent that it relates to items recognized in other compre-
hensive income or directly in equity. In this case the tax is also recognized in other comprehensive income or directly
in equity, respectively.
Nishat Chunian Power Limited - Subsidiary Company and NC Electric Company Limited – Subsidiary Company have
not made provision for deferred tax as the management believes that the temporary differences will not reverse in the
foreseeable future due to the fact that the profits and gains derived from electric power generation are exempt from
tax subject to the conditions and limitations provided for in terms of clause (132), Part I of the Second Schedule to the
Income Tax Ordinance, 2001.
2.4 Employee benefits
The main features of the schemes operated are as follows:
Provident fund
The Holding Company, Nishat Chunian Power Limited – Subsidiary Company and NC Electric Company Limited – Sub-
sidiary Company operate funded provident fund schemes covering all permanent employees. Equal monthly contribu-
tions are made both by the employees and the employers’ to funds in accordance with the funds’ rules. The employers’
contributions to the funds are charged to income currently.

The Holding Company provides for accumulating compensated absences, when the employees render service that
increase their entitlement to future compensated absences.
2.5 Fixed assets
Property, plant, equipment and depreciation
Property, plant and equipment except freehold land and capital work-in-progress are stated at cost less accumulated
depreciation and any identified impairment loss. Cost in relation to certain property, plant and equipment signifies his-
torical cost, borrowing cost pertaining to erection / construction period of qualifying assets and other directly attributable
cost of bringing the asset to working condition. Freehold land and capital work-in-progress are stated at cost less any
identified impairment loss.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the Group and cost of the item
can be measured reliably. All other repair and maintenance costs are charged to income during the period in which
they are incurred.
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Depreciation
Depreciation on all operating fixed assets, other than standby generators, is charged to income on the reducing bal-
ance method, except in case of Nishat Chunian Power Limited - Subsidiary Company, NC Electric Company Limited
– Subsidiary Company and Nishat Chunian USA Inc. – Subsidiary Company, where this accounting estimate is based
on straight line method, so as to write off the cost / depreciable amount of the assets over their estimated useful lives at
the rates given in Note 14.1. Depreciation on additions is charged from the month in which the assets are available for
use upto the month prior to disposal. Depreciation on standby generators is charged on the basis of number of hours
used. The assets’ residual values and useful lives are reviewed at each financial year end and adjusted if impact on
depreciation is significant.
Previously, depreciation on standby generators was charged on reducing balance method. However, during the year,
the Group’s management carried out a comprehensive review of the pattern of consumption of economic benefits of
the operating fixed assets. Now, the Group charges depreciation on standby generators on the basis of number of
hours used. Such a change has been accounted for as a change in an accounting estimate in accordance with IAS 8
‘Accounting Policies, Changes in Accounting Estimates and Errors’.
Had there been no change in the accounting estimate, the profit after taxation for the year ended 30 June 2019 would
have been lower by Rupees 27.846 million and carrying value of operating fixed assets as at that date would have been
lower by the same amount.
Derecognition
An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference
between the net disposal proceeds and carrying amount of the asset) is included in the consolidated statement of profit
or loss in the year the asset is derecognized.
2.6 Intangible assets
Intangible assets, which are non-monetary assets without physical substance, are recognized at cost, which comprise
purchase price, non-refundable purchase taxes and other directly attributable expenditures relating to their implemen-
tation and customization. After initial recognition, an intangible asset is carried at cost less accumulated amortization
and impairment losses, if any. Intangible assets are amortized from the month when these assets are available for use,
using the straight line method, whereby the cost of the intangible asset is amortized over its estimated useful life over
which economic benefits are expected to flow to the Group. The useful life and amortization method is reviewed and
adjusted, if appropriate, at each reporting date.
2.7 Goodwill
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non controlling
interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over
the net of the acquisition date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassess-
ment, the net of the acquisition date amounts of the identifiable assets acquired and liabilities assumed exceeds the
sum of the consideration transferred, the amount of any non controlling interests in the acquiree and the fair value of
the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as
a bargain purchase gain. Goodwill is not amortised but is reviewed for impairment at least annually.

2.8 IFRS 9 “Financial instruments”
The Group has adopted IFRS 9 “Financial Instruments” from 01 July 2018. The standard introduced new classification
and measurement models for financial assets. A financial asset shall be measured at amortised cost if it is held within
a business model whose objective is to hold assets in order to collect contractual cash flows which arise on specified
dates and that are solely principal and interest. A debt investment shall be measured at fair value through other compre-
hensive income if it is held within a business model whose objective is to both hold assets in order to collect contractual

cash flows which arise on specified dates that are solely principal and interest as well as selling the asset on the basis
of its fair value. All other financial assets are classified and measured at fair value through profit or loss unless the
Group makes an irrevocable election on initial recognition to present gains and losses on equity instruments in other
comprehensive income. Despite these requirements, a financial asset may be irrevocably designated as measured
at fair value through profit or loss to reduce the effect of, or eliminate, an accounting mismatch. For financial liabilities
designated at fair value through profit or loss, the standard requires the portion of the change in fair value that relates
to the Group’s own credit risk to be presented in other comprehensive income (unless it would create an accounting
mismatch). New simpler hedge accounting requirements are intended to more closely align the accounting treatment
with the risk management activities of the Group. New impairment requirements use an ‘expected credit loss’ (‘ECL’)
model to recognize an allowance. Impairment is measured using a 12-month ECL method unless the credit risk on a fi-
nancial instrument has increased significantly since initial recognition in which case the lifetime ECL method is adopted.
For receivables, a simplified approach to measuring expected credit losses using a lifetime expected loss allowance is
available.
The Group has adopted IFRS 9 without restating the prior year results. Key changes in accounting policies resulting
from application of IFRS 9 are as follows:
i) Recognition of financial instruments
The Group initially recognizes financial assets on the date when they are originated. Financial liabilities are initially
recognized on the trade date when the entity becomes a party to the contractual provisions of the instrument.
ii) Classification and measurement of financial instruments
IFRS 9 largely retains the existing requirements in IAS 39 “Financial Instruments: Recognition and Measurement”
for the classification and measurement of financial liabilities. However, it replaces the previous IAS 39 categories for
financial assets i.e. loans and receivables, fair value through profit or loss (FVTPL), available for sale and held to ma-
turity with the categories such as amortized cost, fair value through profit or loss (FVTPL) and fair value through other
comprehensive income (FVTOCI).
Investments and other financial assets
a) Classification
From 01 July 2018, the Group classifies its financial assets in the following measurement categories:
• those to be measured subsequently at fair value (either through other comprehensive income, or through profit
or loss), and
• those to be measured at amortized cost
The classification depends on the Group’s business model for managing the financial assets and the contractual terms
of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive in-
come. For investments in debt instruments, this will depend on the business model in which the investment is held. For
investments in equity instruments, this will depend on whether the Group has made an irrevocable election at the time
of initial recognition to account for the equity investment at fair value through other comprehensive income. The Group
reclassifies debt investments when and only when its business model for managing those assets changes.
b) Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at
fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset.
Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows
2019 112 Nishat

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are solely payment of principal and interest.
Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and
the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its
debt instruments:
Amortized cost
Financial assets that are held for collection of contractual cash flows where those cash flows represent solely payments
of principal and interest are measured at amortised cost. Interest income from these financial assets is included in other
income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit
or loss and presented in other income / (other expenses) together with foreign exchange gains and losses. Impairment
losses are presented as separate line item in the consolidated statement of profit or loss.
Financial assets that are held for collection of contractual cash flows and for selling the financial assets, where the
assets’ cash flows represent solely payments of principal and interest, are measured at FVTOCI. Movements in the
carrying amount are taken through other comprehensive income, except for the recognition of impairment losses
(and reversal of impairement losses), interest income and foreign exchange gains and losses which are recognised
in profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in other
comprehensive income is reclassified from equity to profit or loss and recognised in other income / (other expenses).
Interest income from these financial assets is included in other income using the effective interest rate method. Foreign
exchange gains and losses are presented in other income/ (other expenses) and impairment losses are presented as
separate line item in the consolidated statement of profit or loss.
Assets that do not meet the criteria for amortised cost or FVTOCI are measured at FVTPL. A gain or loss on a debt in-
strument that is subsequently measured at FVTPL is recognised in profit or loss and presented net within other income
/ (other expenses) in the period in which it arises.
Equity instruments
The Group subsequently measures all equity investments at fair value for financial instruments quoted in an active
market, the fair value corresponds to a market price (level 1). For financial instruments that are not quoted in an active
market, the fair value is determined using valuation techniques including reference to recent arm’s length market trans-
actions or transactions involving financial instruments which are substantially the same (level 2), or discounted cash
flow analysis including, to the greatest possible extent, assumptions consistent with observable market data (level 3).
Where the Group’s management has elected to present fair value gains and losses on equity investments in other com-
prehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss. Impairment
losses (and reversal of impairment losses) on equity investments measured at FVTOCI are not reported separately
from other changes in fair value.
Changes in the fair value of equity investments at fair value through profit or loss are recognised in other income/ (other
expenses) in the consolidated statement of profit or loss as applicable.
Dividends from such investments continue to be recognised in profit or loss as other income when the Group’s right to
receive payments is established.

a) Classification and measurement
Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL
if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities
at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit
or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. In-
terest expense and foreign exchange gains and losses are recognized in consolidated statement of profit or loss. Any
gain or loss on de-recognition is also included in profit or loss.
iii) Impairment of financial assets
From 01 July 2018, the Group assesses on a forward looking basis the expected credit losses associated with its debt
instruments carried at amortised cost and FVTOCI. The impairment methodology applied depends on whether there
has been a significant increase in credit risk.
For trade debts and other receivables, the Group applies the simplified approach permitted by IFRS 9, which requires
expected lifetime losses to be recognised from initial recognition of the receivables.
iv) De-recognition
a) Financial assets
The Group derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it
transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and re-
wards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all of the risks
and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognized
financial assets that is created or retained by the Group is recognized as a separate asset or liability.
b) Financial liabilities
The Group derecognizes a financial liability (or a part of financial liability) from its consolidated statement of financial
position when the obligation specified in the contract is discharged or cancelled or expires.
v) Offsetting of financial instruments
Financial assets and financial liabilities are set off and the net amount is reported in the consolidated financial state-
ments when there is a legal enforceable right to set off and the Group intends either to settle on a net basis or to realize
the assets and to settle the liabilities simultaneously.
vi) Hedge accounting
IFRS 9 requires that hedge accounting relationships are aligned with its risk management objectives and strategy and
to apply a more qualitative and forward-looking approach to assessing hedge effectiveness.
There is no impact of the said change on these consolidated financial statements as there is no hedge activity carried
on by the Group during the year ended 30 June 2019.
vii) Impacts of adoption of IFRS 9 on these consolidated financial statements as on 01 July 2018
On 01 July 2018, the Group’s management has assessed which business models apply to the financial assets held by
the Group at the date of initial application of IFRS 9 (01 July 2018) and has classified its financial instruments into ap-
propriate IFRS 9 categories. The main effects resulting from this reclassification are as follows:
2019 114 Nishat

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Financial assets (01 July 2018)
Trade debts categorized as
Loans and Amortised cost
receivables
- - - - - - - - - - - Rupees - - - - - - - - - -
Opening balance (before reclassification) 19,204,333,280 -
Reclassification of trade debts (19,204,333,280) 19,204,333,280
Recognition of expected credit losses on trade debts - (5,288,510)
Opening balance (after reclassification) - 19,199,044,770
The impact of these changes on the Group’s reserves and equity is as follows:
Reserves and equity (01 July 2018)
Effect on un-ap- Effect on total

propriated profit equity
- - - - - - - - - - - Rupees - - - - - - - - - -
Opening balance (before reclassification) 13,456,551,206 24,058,497,357
Adjustment on adoption of IFRS 9 due to recognition of expected life time
credit losses on trade debts (5,288,510) (5,288,510)
Opening balance (after reclassification) 13,451,262,696 24,053,208,847
Reclassifications of financial instruments on adoption of IFRS 9
As on 01 July 2018, the classification and measurement of financial instruments of the Group were as follows:
Measurement category Carrying amounts

Original New Original New Difference
(IAS 39) (IFRS 9) Rupees
assets
Long term loans to Loans and receiva- Amortised cost 17,897,227 17,897,227 -
employees bles
Long term security Loans and receiva- Amortised cost 23,752,440 23,752,440 -
deposits bles
Current financial as-
sets
Trade debts Loans and receiva- Amortised cost 19,204,333,280 19,199,044,770 (5,288,510)
bles
Loans and advances Loans and receiva- Amortised cost 14,279,342 14,279,342 -
bles
Short term deposits Loans and receiva- Amortised cost 9,760,036 9,760,036 -
bles
Other receivables Loans and receiva- Amortised cost 999,427,153 999,427,153 -
bles
Short term investments Amortised cost Amortised cost 32,179,691 32,179,691 -
Cash and bank bal- Loans and receiva- Amortised cost 252,266,580 252,266,580 -
ances bles

Nishat (Chunian)
Limited 115 2019
liabilities
Long term financing Amortised cost Amortised cost 10,481,386,830 10,481,386,830 -
Current financial li-
abilities
Trade and other paya- Amortised cost Amortised cost 2,813,085,399 2,813,085,399 -
bles
Accrued mark-up Amortised cost Amortised cost 570,404,272 570,404,272 -
Short term borrowings Amortised cost Amortised cost 25,510,180,650 25,510,180,650 -
Current portion of non- Amortised cost Amortised cost 4,675,185,917 4,675,185,917 -
current liabilities
Unclaimed dividend Amortised cost Amortised cost 53,705,334 53,705,334 -
2.9 Inventories
Inventories, except for stock-in-transit and waste stock, are stated at lower of cost and net realizable value. Cost is
determined as follows:
Stores, spare parts and loose tools

Usable stores, spares parts, loose tools are valued principally at weighted average cost, while items considered obso-
lete are carried at nil value. Items-in-transit are valued at cost comprising invoice value plus other charges paid thereon.
Stock-in-trade
Cost of raw materials is measured using the weighted average cost formula.
Cost of work-in-process and finished goods comprise cost of direct material, labour and appropriate manufacturing
overheads. Cost of goods purchased for resale is based on first-in-first-out (FIFO) cost formula.
Materials in transit are stated at cost comprising invoice values plus other charges paid thereon. Waste stock is valued
at net realizable value.

Net realizable value signifies the estimated selling price in the ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make the sale.
2.10 Foreign currencies
These consolidated financial statements are presented in Pak Rupees, which is the Group’s functional currency. All
monetary assets and liabilities denominated in foreign currencies are translated into Pak Rupees at the rates of ex-
change prevailing at the reporting date, while the transactions in foreign currencies (except the results of foreign op-
eration which are translated to Pak Rupees at the average rate of exchange for the year) during the year are initially
recorded in functional currency at the rates of exchange prevailing at the transaction date. All non-monetary items are
translated into Pak Rupees at exchange rates prevailing on the date of transaction or on the date when fair values are
determined. Exchange gains and losses are recorded in the consolidated statement of profit or loss.
2.11 Borrowings
Borrowings are recognized initially at fair value and are subsequently stated at amortized cost; any difference between
the proceeds and the redemption value is recognized in the consolidated statement of profit or loss over the period of
the borrowings using the effective interest rate method.

2.12 Trade debts and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses. Trade receivables generally do not include amounts
over due by 365 days.
The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected
loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
However, in respect of companies holding financial assets due from the Government of Pakistan, SECP through SRO
985(I)/2019 dated 02 September 2019 has notified that the requirements contained in IFRS 9 with respect to applica-
tion of expected credit losses method shall not be applicable till 30 June 2021 and that such companies shall follow
relevant requirements of IAS 39 in respect of above referred financial assets during the exemption period.
2.13 Trade and other payables
Liabilities for trade and other amounts payable are initially recognized at fair value which is normally the transaction
cost.
2.14 Borrowing cost
Borrowing costs are recognized as expense in the period in which these are incurred except to the extent of borrowing
costs that are directly attributable to the acquisition, construction or production of a qualifying asset. Such borrowing
costs, if any, are capitalized as part of cost of that asset.

2.15 Revenue from contracts with customers

The Group has adopted IFRS 15 from 01 July 2018. The standard provides a single comprehensive model for rev-
enue recognition. The core principle of the standard is that an entity shall recognise revenue to depict the transfer of
promised goods or services to customers at an amount that reflects the consideration to which the entity expects to be
entitled in exchange for those goods or services. The standard introduced a new contract-based revenue recognition
model with a measurement approach that is based on an allocation of the transaction price. This is described further in
the accounting policies below. Credit risk is presented separately as an expense rather than adjusted against revenue.
Contracts with customers are presented in Group’s statement of financial position as a contract liability, a contract as-
set, or a receivable, depending on the relationship between the Group’s performance and the customer’s payment.
Customer acquisition costs and costs to fulfil a contract can, subject to certain criteria, be capitalised as an asset and
amortised over the contract period.
The Group has adopted IFRS 15 by applying the modified retrospective approach according to which the Group is not
required to restate the prior year results. Key changes in accounting policies resulting from application of IFRS 15 are
as follows:
i) Revenue recognition
Revenue is recognised at an amount that reflects the consideration to which the Group is expected to be entitled in
exchange for transferring goods or services to a customer. For each contract with a customer, the Group: identifies the
contract with a customer; identifies the performance obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time value of money; allocates the transaction price
to the separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or
service to be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that
depicts the transfer to the customer of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as dis-

counts, rebates and refunds, any potential bonuses receivable from the customer and any other contingent events.
Such estimates are determined using either the ‘expected value’ or ‘most likely amount’ method. The measurement of
variable consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it
is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur. The meas-
urement constraint continues until the uncertainty associated with the variable consideration is subsequently resolved.
Amounts received that are subject to the constraining principle are initially recognised as deferred revenue in the form
of a separate refund liability.
Sale of goods
Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the goods,
which is generally at the time of delivery.
Rendering of services
Revenue from a contract to provide services is recognised over time as the services are rendered based on either a
fixed price or an hourly rate.
Interest
Interest income is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective inter-
est rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial
asset to the net carrying amount of the financial asset.
Sale of electricity
Revenue from the sale of electricity to NTDC, the sole customer of Nishat Power Limited – Subsidiary Company, is
recorded on the following basis:
Capacity revenue is recognized based on the capacity made available to NTDC; and
Energy revenue is recognized based on the Net Electrical Output (NEO) delivered to NTDC.
Capacity and Energy revenue is recognized based on the rates determined under the mechanism laid down in the
Power Purchase Agreement.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
ii) Contract assets
Contract assets arise when the Group performs its performance obligations by transferring goods to a customer be-
fore the customer pays its consideration or before payment is due. Contract assets are treated as financial assets for
impairment purposes.
iii) Customer acquisition costs
Customer acquisition costs are capitalised as an asset where such costs are incremental to obtaining a contract with
a customer and are expected to be recovered. Customer acquisition costs are amortised on a straight-line basis over
the term of the contract.
Costs to obtain a contract that would have been incurred regardless of whether the contract was obtained or which are
not otherwise recoverable from a customer are expensed as incurred to profit or loss. Incremental costs of obtaining a
contract where the contract term is less than one year is immediately expensed to profit or loss.

iv) Customer fulfilment costs
Customer fulfilment costs are capitalised as an asset when all the following are met: (i) the costs relate directly to the
contract or specifically identifiable proposed contract; (ii) the costs generate or enhance resources of the Group that will
be used to satisfy future performance obligations; and (iii) the costs are expected to be recovered. Customer fulfilment
costs are amortised on a straight-line basis over the term of the contract.
v) Right of return assets
Right of return assets represents the right to recover inventory sold to customers and is based on an estimate of cus-
tomers who may exercise their right to return the goods and claim a refund. Such rights are measured at the value at
which the inventory was previously carried prior to sale, less expected recovery costs and any impairment.
vi) Contract liabilities
Contract liability is the obligation of the Group to transfer goods to a customer for which the Group has received con-
sideration from the customer. If a customer pays consideration before the Group transfers goods, a contract liability
is recognized when the payment is made. Contract liabilities are recognized as revenue when the Group performs its
performance obligations under the contract.
vii) Refund liabilities
Refund liabilities are recognised where the Group receives consideration from a customer and expects to refund some,
or all, of that consideration to the customer. A refund liability is measured at the amount of consideration received or
receivable for which the Group does not expect to be entitled and is updated at the end of each reporting period for
changes in circumstances. Historical data is used across product lines to estimate such returns at the time of sale
based on an expected value methodology.
viii) Impacts of adoption of IFRS 15 on these consolidated financial statements as on 01 July 2018
The following adjustments were made to the amounts recognized in the consolidated financial statements at 01 July
2018:
• Stock in trade as at 01 July 2018 increased by Rupees 1,008,464,541.

• Trade debts as at 01 July 2018 decreased by Rupees 1,232,775,468.
• Trade and other payables as at 01 July 2018 decreased by Rupees 11,215,546.
• Reserves / Equity as at 01 July 2018 decreased by Rupees 213,095,381.
2.16 Share capital

Ordinary shares and irredeemable preference shares are classified as equity. Incremental costs directly attributable to
the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.
2.17 Cash and cash equivalents

Cash and cash equivalents are carried in the statement of financial position at book value which approximates their fair
value. For the purpose of consolidated cash flow statement, cash and cash equivalents comprise cash in hand, cash
at banks on current, saving and deposit accounts, other short term highly liquid instruments that are readily convertible
to known amounts of cash and which are subject to an insignificant risk of changes in value.
2.18 Derivative financial instruments

Derivatives are initially recognized at fair value. Any directly attributable transaction costs are recognized in the consoli-
dated statement of profit or loss as incurred. They are subsequently remeasured at fair value on regular basis and at
each reporting date as a minimum, with all their gains and losses, realized and unrealized, recognized in the consoli-
dated statement of profit or loss.

2.19 Provisions
Provisions are recognized when the Group has a legal or constructive obligation as a result of past events and it is prob-
able that an outflow of resources embodying economic benefits will be required to settle the obligations and a reliable
estimate of the amount can be made.
2.20 Impairment of non-financial assets
Assets that have an indefinite useful life are not subject to depreciation and are tested annually for impairment. Assets
that are subject to depreciation are reviewed for impairment at each consolidated statement of financial position date
or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impair-
ment loss is recognized for the amount for which assets carrying amount exceeds its recoverable amount. Recoverable
amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impair-
ment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating
units). Non-financial assets that suffered an impairment are reviewed for possible reversal of the impairment at each
reporting date. Reversals of the impairment losses are restricted to the extent that the asset’s carrying amount does
not exceed the carrying amount that would have been determined, net of depreciation or amortization, if impairment
losses had not been recognized. An impairment loss or reversal of impairment loss is recognized in the consolidated
statement of profit or loss.
2.21 Segment reporting
Segment reporting is based on the operating (business) segments of the Group. An operating segment is a component
of the Group that engages in business activities from which it may earn revenues and incur expenses, including rev-
enues and expenses that relate to the transactions with any of the Group’s other components. An operating segment’s
operating results are reviewed regularly by the Group’s chief operating decision makers to make decisions about
resources to be allocated to the segment and assess its performance, and for which discrete financial information is
available.
Segment results that are reported to the chief operating decision makers include items directly attributable to a seg-
ment as well as those that can be allocated on a reasonable basis. Those incomes, expenses, assets, liabilities and
other balances which cannot be allocated to a particular segment on a reasonable basis are reported as unallocated.
The Group has following reportable business segments. Spinning – Zone 1, 2 and 3 (Producing different quality of
yarn using natural and artificial fibers), Weaving – Unit 1 and 2 (Producing different quality of greige fabric using yarn),
Processing and Home Textile (Processing greige fabric for production of printed and dyed fabric and manufacturing of
home textile articles), Power Generation (Generating, transmitting and distributing power) and Entertainment (Operat-
ing cinemas).
Transaction among the business segments are recorded at arm’s length prices using admissible valuation methods.
Inter segment sales and purchases are eliminated from the total.
2.22 Dividend to ordinary shareholders and other appropriations
Dividend distribution to the ordinary shareholders is recognized as a liability in the Group’s consolidated financial state-
ments in period in which the dividends are declared and other appropriations are recognized in the period in which
these are approved by the Board of Directors.

2.23 Ijarah transactions
Ujrah (lease) payments are recognized as expenses in consolidated statement of profit or loss on a straight-line basis
over the Ijarah term unless another systematic basis is representative of the time pattern of the user’s benefit even if
the payments are not on that basis.
2.24 Government grants
Government grants are recognized when there is reasonable assurance that entity will comply with the conditions at-
tached to it and grant will be received.

2019 2018
Rupees Rupees
3. AUTHORIZED SHARE CAPITAL
2019 2018
(Number of shares)
280,000,000 280,000,000 Ordinary shares of Rupees 10

each 2,800,000,000 2,800,000,000
20,000,000 20,000,000 Preference shares of Rupees

10 each 200,000,000 200,000,000
300,000,000 300,000,000 3,000,000,000 3,000,000,000
4. ISSUED, SUBSCRIBED AND PAID-UP SHARE CAPITAL
2019 2018
(Number of shares)

each fully paid in cash 1,347,578,480 1,347,578,480

each issued as fully paid
bonus shares 1,042,394,430 1,042,394,430
1,224,265 1,224,265 Ordinary shares of Rupees

10 each issued as fully paid
for consideration other than
cash to members of Umer
Fabrics Limited as per the
Scheme of Arrangement as
approved by the Honourable
Lahore High Court, Lahore 12,242,650 12,242,650
240,221,556 240,221,556 2,402,215,560 2,402,215,560
2019 2018
(Number of shares)
4.1 Ordinary shares of the Holding Company held by companies that are related parties:
Nishat Mills Limited 32,689,338 32,689,338

D.G. Khan Cement Company Limited 7,274,602 7,274,602
Adamjee Life Assurance Company Limited 2,202,500 1,300,000
42,166,440 41,263,940
2019 122 Nishat
Nishat (Chunian)
(Chunian) Limited
2019 2018
Rupees Rupees
5. RESERVES
Composition of reserves is as follows:
Capital reserves
Exchange translation reserve [Note 2.2(b)] (14,141,413) (6,678,937)

Share premium (Note 5.1) 600,553,890 600,553,890
586,412,477 593,874,953
Revenue reserves
General reserve 1,629,221,278 1,629,221,278
Unappropriated profit 15,823,940,210 13,456,551,206
17,453,161,488 15,085,772,484
18,039,573,965 15,679,647,437
5.1 This reserve can be utilized only for the purposes specified in section 81 of the Companies Act, 2017.
2019 2018
Rupees Rupees
6. LONG TERM FINANCING
From banking companies / financial institutions - secured
Long term loans (Note 6.1)

- MCB Bank Limited - associated company 886,596,325 1,108,670,100
- Others 8,467,203,701 12,630,902,647
9,353,800,026 13,739,572,747
Long term musharaka (Note 6.2) 1,080,555,556 1,417,000,000

10,434,355,582 15,156,572,747
Less: Current portion shown under current liabilities

Long term loans:

- Others 3,974,188,698 4,063,698,948
4,221,293,723 4,280,741,473
Long term musharaka 394,444,444 394,444,444

4,615,738,167 4,675,185,917
5,818,617,415 10,481,386,830
Nishat (Chunian)
Nishat (Chunian) Limited Limited
and its subsidiaries 123 2019
2019
124
RATE OF MARK-UP MARK-UP MARK-UP
Nishat
LENDER 2019 2018 NUMBER OF INSTALMENTS
PER ANNUM REPRICING PAYABLE
Rupees Rupees
Nishat (Chunian)
6.1 Long term loans
(Chunian) Limited
Nishat (Chunian) Limited - Holding Company (Note 6.3)
From MCB Bank Limited -

associated company:
MCB Bank Limited 160,000,000 160,000,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commencing on - Quarterly
25 July 2019 and ending on 25 January 2027.
MCB Bank Limited 75,468,750 80,500,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commenced on - Quarterly
22 June 2019 and ending on 22 December 2026.
235,468,750 240,500,000
From others:
Standard Chartered Bank (Pakistan) - 187,500,000 3-month KIBOR + 0.75% Sixteen equal quarterly instalments commenced on 04 Quarterly Quarterly
Limited May 2015 and ended on 04 February 2019.
Allied Bank Limited 9,647,500 17,365,500 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 22 - Quarterly
October 2016 and ending on 22 July 2020.
January 2017 and ending on 10 October 2020.
May 2017 and ending on 11 February 2021.
Allied Bank Limited 220,312,500 235,000,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commenced on - Quarterly
24 February 2019 and ending on 24 November 2026.
18 April 2019 and ending on 18 January 2027.
Allied Bank Limited 92,612,500 104,562,500 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 21 - Quarterly
Allied Bank Limited Rupees
117,800,000 Rupees
117,800,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commencing on - Quarterly
03 July 2019 and ending on 03 April 2027.
6.1 Askari
Long Bank loans
term Limited 87,500,000 157,500,000 3-month KIBOR + 0.70% Twenty equal quarterly instalments commenced on 08 Quarterly Quarterly
December 2015 and ending on 08 September 2020.
Askari (Chunian)
NishatBank LimitedLimited - Holding Company (Note 6.3)
124,500,000 141,100,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 02 - Quarterly
February 2017 and ending on 02 November 2026.
Askari Bank Limited 15,000,000 17,000,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 04 - Quarterly
associated company:
February 2017 and ending on 04 November 2026.
Askari Bank Limited 112,500,000 127,500,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 08 - Quarterly
MCB Bank Limited 160,000,000 160,000,000 SBP rate for LTFF + 1.00% Sixteen
March 2017 half
equaland ending
yearlyoninstalments
08 Decembercommencing
2026. on - Quarterly
Askari Bank Limited 103,540,000 116,900,000 SBP rate for LTFF + 1.00% 25
Forty
Julyequal and ending
2019 quarterly on 25 January
instalments 2027.
commenced on 22 - Quarterly
MCB Bank Limited 75,468,750 80,500,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments
June 2017 and ending on 22 March 2027. commenced on - Quarterly
Askari Bank Limited 4,960,000 5,580,000 SBP rate for LTFF + 1.00% 22 June
Forty equal and ending
2019quarterly on 22 December
2026. on 12 - Quarterly
235,468,750 240,500,000 September 2017 and ending on 12 June 2027.
Askari others:
From Bank Limited 46,200,000 51,800,000 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 04 - Quarterly
Standard
Askari Chartered
Bank Limited Bank (Pakistan) 16,747,500- 187,500,000
18,777,500 3-month KIBOR + 0.75% Sixteen
SBP rate for LTFF + 1.00% Forty equalequalquarterly
commenced on on 04
04 Quarterly
- Quarterly
Quarterly
Limited May
October
20152017 ended
and and ending
on 04onFebruary 2019.
04 July 2027.
Allied
Askari Bank
Bank Limited
Limited 9,647,500
16,000,000 17,365,500
18,000,000 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
1.00% Sixteen
Forty equal
equalquarterly
commenced on on 22
26 -- Quarterly
Quarterly
October
August 2017
2016andandending
endingonon2622May 2020.
July2027.
Allied Bank
Askari Bank Limited
Limited 54,000,000
94,240,000 90,000,000
106,020,000 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
1.00% Sixteen
Forty equal
equalquarterly
commenced on on 07
26 -- Quarterly
Quarterly
January 2017 and ending on 10
August 2017 and ending on 26 May 2027. October 2020.
Allied Bank
Askari Bank Limited
Limited 58,125,000
4,603,200 96,875,000
5,178,600 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
1.00% Sixteen
Forty equal
equalquarterly
commenced on on 20
26 - Quarterly
Quarterly
January 2017 and ending on 20 October 2020. -
August 2017 and ending on 26 May 2027.
Allied Bank
Askari Bank Limited
Limited 30,681,000
188,800,000 48,213,000
212,400,000 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
1.00% Sixteen
Forty equal
equalquarterly
commenced on on 11
26 - Quarterly
Quarterly
May 2017 and ending on 11 February 2021. -
August 2017 and ending on 26 May 2027.

Pak
AlliedKuwait
Bank Investment
Limited Company 220,312,500
24,491,000 235,000,000
38,487,000 SBP
SBP rate
rate for
for LTFF
LTFF ++ 1.00%
0.75% Thirty
Eighteen
two equal
equal quarterly instalments commenced
quarterly instalments commenced on on -- Quarterly
Quarterly
(Private) Limited 24 February 2019 and ending on 24 November
22 November 2016 and ending on 22 February 2021. 2026.
Nishat (Chunian)
The
AlliedBank
BankofLimited
Punjab 127,584,375
300,000,000 131,700,000
400,000,000 SBP rate for LTFF +
3-month KIBOR + 0.75%1.00% Thirty two equal
Ten equal quarterly
commenced on on
30 -
Quarterly Quarterly
Quarterly
18 April 2019 and ending on 18 January
September 2017 and ending on 30 March 2022. 2027.
Limited
Allied Bank
Habib Bank Limited
Limited 378,781,250
1,400,000,000 391,000,000
1,800,000,000 SBP
3-month for LTFF
rate KIBOR + 1.00% Thirty
+ 0.50% two equal
Ten equal quarterly
commenced on on
27 -
Quarterly Quarterly
Quarterly
125
March 2018 and ending on 27 September 2022.
2019
2019
126
Nishat
Nishat (Chunian)
Soneri Bank Limited Rupees
290,140,625 Rupees
299,500,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commenced on - Quarterly
(Chunian) Limited
14 June 2019 and ending on 14 March 2027.
6.1 Long
Soneriterm
Bankloans
Limited 222,000,000 222,000,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commencing on - Quarterly
06 July 2019 and ending on 06 April 2027.

Syndicated term finance
associated company:
Allied Bank Limited - 220,000,000 3-month KIBOR + 1% Ten equal half yearly instalments commenced on 27 Quarterly Quarterly
December 2014 and ended on 27 June 2019.
MCB
HabibBank
BankLimited
Limited 160,000,000
- 160,000,000 SBP rate for LTFF
60,000,000 3-month KIBOR + 1%+ 1.00% Sixteen
Ten equal
equal halfhalf yearly
yearly instalments
commenced on
on 27 -
Quarterly Quarterly
Quarterly
25 July 2019
December 2014
andandending
ended
on on January
25 27 June 2027.
2019.
MCB
HabibBank
Metropolitan
Limited Bank Limited 75,468,750
- 80,500,000 SBP rate for LTFF
20,000,000 3-month KIBOR + 1%+ 1.00% Sixteen equal half yearly instalments commenced
Ten equal half yearly instalments commenced on 27 on -
Quarterly Quarterly
Quarterly
22 June 2019
December 2014 ending
andand endedonon December
2227 2026.
June 2019.
235,468,750
- 240,500,000
300,000,000
From others:
4,140,766,450 5,457,759,100
NC Electric
Standard Company
Chartered BankLimited - Subsidiary Company
(Pakistan) - (Notes
187,500,000
6.5 and 6.9)3-month KIBOR + 0.75% Sixteen equal quarterly instalments commenced on 04 Quarterly Quarterly
Limited May 2015 and ended on 04 February 2019.
Allied
FromBank Bank Limited -
MCBLimited 9,647,500 17,365,500 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced on 22 - Quarterly
associated company: October 2016 and ending on 22 July 2020.
MCB Bank Limited 389,400,000 519,200,000 SBP rate for LTFF+ 1.25% T en equal semi annual instalments with grace period - Quarterly
of two years
MCB Bank Limited 261,727,575 348,970,100 6-month KIBOR + 0.90% Ten equal semi annual instalments with grace period Half yearly Half yearly
of two years
651,127,575 868,170,100
Allied
FromBank Limited
others: 220,312,500 235,000,000 SBP rate for LTFF + 1.00% Thirty two equal quarterly instalments commenced on - Quarterly
Allied
HabibBank Limited
127,584,375 1,010,646,657 6-month
131,700,000 SBP KIBOR
rate for LTFF++0.90%
1.00% Nine
Thirtyequal semi annual
two equal quarterlyinstalments
instalmentswith grace period
commenced on Half yearly
- Quarterly
Quarterly
of two years
Allied
Allied Bank Limited
Bank Limited 277,777,780
378,781,250 388,888,890
391,000,000 SBP
SBP rate
rate for
for LTFF
LTFF++ 1.00%
1.00% Nine
Thirtyequal semi annual
two equal quarterlyinstalments
instalmentswith grace period
commenced on -- Quarterly
Quarterly
of eighteen months
Allied Bank Limited 999,668,251
92,612,500 1,399,535,547
104,562,500 SBP rate for LTFF + 1.00% Forty equal quarterly instalments commenced on 21 - Quarterly
Rupees
Nishat Chunian Power Limited - Subsidiary Company (NoteRupees
6.6)
6.1 Long term

Senior loans
facility 2,676,419,000 4,489,070,000 3-month KIBOR + 3% Twenty five quarterly instalments ending on 01 July Quarterly Quarterly
2020.
Nishat
Term (Chunian) Limited - Holding Company
finance facility 650,350,000
(Note 6.3) 1,084,538,000 3-month KIBOR + 3% Twenty five quarterly instalments ending on 01 July Quarterly Quarterly
2020.
From MCB Bank Limited - 3,326,769,000 5,573,608,000
associated company:
MCB
NC Bank
Entertainment 160,000,000
Limited (Private) Limited - former 160,000,000
Subsidiary Company SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commencing on - Quarterly
25 July 2019 and ending on 25 January 2027.
JS Bank
MCB BankLimited
Limited -
75,468,750 200,000,000
80,500,000 1-month
SBP rateKIBOR + 1.50%
for LTFF + 1.00%Four equal quarterly
Sixteen equal halfinstalments ending on June
yearly instalments 2020
commenced on - - Quarterly
Quarterly
235,468,750
9,353,800,026 240,500,000
13,739,572,747
From others:
Standard Chartered Bank (Pakistan) - 187,500,000 3-month KIBOR + 0.75% Sixteen equal quarterly instalments commenced on 04 Quarterly Quarterly
Limited RATE OF PROFIT PER May 2015 and ended on 04 February 2019. PROFIT PROFIT
Allied Bank Limited 9,647,500 ANNUM
17,365,500 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced onREPRICING
22 - PAYABLE
Quarterly
6.2 Long term musharaka January 2017 and ending on 10 October 2020.
Nishat (Chunian) Limited - Holding Company (Note 6.4) January 2017 and ending on 20 October 2020.
Faysal Bank Limited 375,000,000 475,000,000 3-month KIBOR + 0.70% Twenty equal quarterly instalments commenced
May 2017 and ending on 11 February 2021. on 21 Quarterly Quarterly
May on 21 February

Allied Bank Limited 220,312,500 235,000,000 SBP rate for LTFF + 1.00% Thirty
2018two
andequal
endingquarterly instalments
2023.commenced on - Quarterly
375,000,000 475,000,000
Nishat (Chunian)
Limited
127
2019
2019
128
Rupees Rupees
NC Electric Company Limited - Subsidiary Company (Notes 6.8 and 6.9)
6.1 Long term loans

Dubai Islamic Bank Pakistan Limited 375,000,000 517,000,000 6 months KIBOR + 0.85% Ten equal semi annual instalments with grace period Half yearly Half yearly
of two years
AlBaraka Bank (Pakistan) Limited 330,555,556 425,000,000 6 months KIBOR + 0.85% Ten equal semi annual instalments with grace period Half yearly Quarterly
of two years
705,555,556 942,000,000
associated company:
1,080,555,556 1,417,000,000
MCB Bank Limited 160,000,000 160,000,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commencing on - Quarterly
6.3 Long term loans are secured by first joint pari passu hypothecation and equitable mortgage on all present
25 July future
and2019 andfixed assets
ending the Holding
on 25ofJanuary 2027. Company to the extent of Rupees
9,950.58 million (2018: Rupees 9,230.58 million).
MCB Bank Limited 75,468,750 80,500,000 SBP rate for LTFF + 1.00% Sixteen equal half yearly instalments commenced on - Quarterly
joint pari passu hypothecation
6.4 Long term musharaka are secured by first235,468,750 240,500,000 and equitable mortgage on all present and future fixed assets of the Holding Company to the extent of
Rupees 666.67 million (2018: Rupees 720 million).
From others:
Long term
6.5 Standard loans from
Chartered BankMCB
(Pakistan)
Bank Limited and Habib -Bank Limited are secured
187,500,000 against
3-month first pari
KIBOR passu charge
+ 0.75% Rupees
Sixteenofequal quarterly million over
4,000instalments commenced and
all presenton fixed assets
04futureQuarterly of the
Quarterly
Limited
NC Electric Company Limited - Subsidiary Company, cross corporate guarantee of Holding Company toMay MCB2015Bank
andLimited amounting
ended on to Rupees
04 February 2019. 1,500 million and cross corporate
guarantee of Holding
Allied Bank Limited Company to Habib Bank Limited
9,647,500 amounting to Rupees 2,000 million. Long term loan from Allied Bank Limited is secured
17,365,500 SBP rate for LTFF + 1.00% Sixteen equal quarterly instalments commenced against
on 22first pari passu
- charge of
Quarterly
Rupees 667 million over all present and future fixed assets (including land and building) of the NC Electric Company Limited - Subsidiary Company and cross corporate guarantee
of Holding Company amounting to Rupees 500 million.
6.6 This represents long term financing obtained from a consortium of banks led by United Bank Limited (Agent
Bank). The portion of long term financing from Faysal Bank Limited is on murabaha basis. The overall
financing is secured against registered first joint pari passu charge on immovable property, mortgage of
project receivables (excluding energy payment receivables), hypothecation of all present and future assets
and all properties of Nishat Chunian Power Limited - Subsidiary Company (excluding working capital
hypothecated property), lien over project bank accounts and pledge of shares held by the Holding
Company in Nishat Chunian Power Limited - Subsidiary Company. It carries mark-up at the rate of three
months Karachi Inter-Bank Offered Rate (KIBOR) plus three percent per annum, payable on quarterly basis.
The mark-up rate charged during the year on the outstanding balance ranges from 9.92% to 13.99% (2018:
9.14% to 9.50%) per annum. As of 30 June 2019, the finance is repayable in five quarterly installments
ending on July 01, 2020.
6.7 In accordance with the terms of agreement with the lenders of long term finances to Nishat Chunian Power
Limited - Subsidiary Company, there are certain restrictions on the distribution of dividends by Nishat
Chunian Power Limited - Subsidiary Company.
6.8 Long term musharaka from Dubai Islamic Bank Pakistan Limited is secured against first pari passu charge of
Rupees 1,333 million over all present and future fixed assets (including land and building) of the NC Electric
Company Limited - Subsidiary Company and cross corporate guarantee of Nishat (Chunian) Limited
amounting to Rupees 375 million. Long term musharaka from Al Baraka Bank (Pakistan) Limited is secured
against first pari passu charge of Rupees 1,000 million over all present and future fixed assets (including
land and building) of the NC Electric Company Limited - Subsidiary Company and cross corporate guarantee
of Nishat (Chunian) Limited amounting to Rupees 1,000 million.
6.9 Total long term loans and long term musharaka facility to NC Electric Company Limited - Subsidiary
Company amounts to Rupees 3.5 billion and Rupees 2 billion respectively. The effective mark-up rate
charged during the year on the outstanding balance ranged from 4.00% to 12.14% (2018: 4.00% to 7.31% )
per annum.
2019 2018
Rupees Rupees
7 DEFERRED REVENUE
Value of subsequent services - 3,715,000
Amortized during the year - (743,000)
- 2,972,000
8 DEFERRED INCOME TAX (ASSET) / LIABILITY

The (asset) / liability for deferred income tax of the NC Entertainment (Private) Limited - former Subsidiary
Company originated due to timing differences relating to:
2019 2018
Rupees Rupees
Taxable temporary difference
Accelerated tax depreciation - 38,394,308
Deductible temporary differences
Accelerated tax amortization on intangible assets - (156,448)
Available tax losses - (43,932,915)
Turnover tax - (2,293,796)
Excess of alternative corporate tax over corporate tax - (804,706)
Deferred income tax asset - (8,793,557)
8.1 Deferred income tax asset of Holding Company Rupees 508.488 million (2018: Rupees 665.133 million) has
not been recognized in these consolidated financial statements as the Holding Company's management
believes that sufficient taxable profits will not be probably available in foreseeable future, hence, the
temporary differences may not reverse.
8.2 The Holding Company has carry forwardable tax losses of Rupees 2,906 million (2018: Rupees 3,524
2019 129 Nishat
Nishat (Chunian)
(Chunian) Limited
8.3 For the purposes of current taxation of Nishat Chunian Power Limited - Subsidiary Company, the tax credit
available for carry forward is estimated at Rupees 133.493 million (2018: Rupees 101.737 million).
Management believes that the tax credit available for carry forward may not be utilized in the foreseeable
future. Consequently, based on the prudence principle, deferred tax asset on tax credit available for carry
forward has not been recognized in these consolidated financial statements.
8.4 Nishat Chunian USA Inc. has net operating loss carry forwards (NOL) of approximately Rupees 33.620 million
(2018: Rupees 38.362 million) which carry forward indefinitely, to reduce future federal and state taxable
income, if any. The Subsidiary Company has not recognized deferred tax asset resulting from NOL of
approximately Rupees 7.052 million (2018: Rupees 12.990 million) based on prudence principle.
2019 2018
Rupees Rupees
9. TRADE AND OTHER PAYABLES
Creditors (Note 9.1) 1,868,318,779 1,503,805,345
Accrued liabilities 1,610,141,411 1,260,097,267
Advances from customers 112,499,908 72,570,280
Securities from customers - interest free (Note 9.2) 19,286,374 9,187,150
Securities from contractors - interest free and repayable on
completion of contracts (Note 9.2) 4,291,800 3,628,300
Retention money 230,639 438,946
Employees' provident fund payable 30,227,689 -
Income tax deducted at source 19,270,559 15,606,762
Fair value of forward exchange contracts 18,467,940 -
Others 37,614,890 35,928,391
4,064,627,697 3,178,485,746
9.1 It includes Rupees 0.724 million (2018: Rupees 0.926 million) due to a related party.
9.2 These deposits have been utilized for the purpose of business in accordance with the terms of written
agreements with contractors.
2019 2018
Rupees Rupees

Less: Adjustment on adoption of IFRS 15 (11,215,546) -
266,007,759 222,483,001
Add: Interest for the year (Note 32) 7,076,497 12,821,913
Add: Allocation for the year 344,252,708 277,223,192
617,336,964 512,528,106
Less: Payments during the year 273,059,256 235,304,801
9.3.1 The Group retains workers' profit participation funds for their business operations till the date of allocation to
workers. Interest is paid at prescribed rate under the Companies Profit (Workers' Participation) Act, 1968 on
funds utilized by the Group till the date of allocation to workers.

2019 2018
Rupees Rupees
10. ACCRUED MARK-UP / PROFIT
Long term financing
- Others 231,658,452 242,583,305
244,185,364 256,611,114
Short term borrowings
- Others 686,056,365 311,769,106
686,056,365 313,793,158
930,241,729 570,404,272
11. SHORT TERM BORROWINGS
From banking companies - secured
Nishat (Chunian) Limited - Holding Company
Short term running finances (Notes 11.1 and 11.2)
- MCB Bank Limited - associated company (Note 11.5) 10,396,890 1,151,049,431
- Others 3,598,081,270 1,136,683,425
3,608,478,160 2,287,732,856
Export finances - Preshipment / SBP refinance (Notes 11.1 and 11.3)
- MCB Bank Limited - associated company (Note 11.5) - 400,839,000

- Others 8,093,500,000 7,150,000,000
8,093,500,000 7,550,839,000
Other short term finances (Notes 11.1 and 11.4) 8,390,000,000 7,183,420,000
NC Electric Company Limited - Subsidiary Company (Notes 11.6 and 11.7)
Short term running finances 219,121,446 409,507,329

Murabaha facilities 364,539,081 299,999,904
Nishat Chunian USA Inc. - Subsidiary Company
Revolving credit line (Note 11.8) - 43,939,273
Nishat Chunian Power Limited - Subsidiary Company
Short term running finances (Note 11.9) 2,927,914,000 37,742,000

Money market loans (Note 11.10) 4,300,000,000 6,070,000,000
Murabaha facilities (Note 11.11) 3,539,747,000 1,548,191,000
NC Entertainment (Private) Limited - former Subsidiary Company
Short term borrowings / loans - 78,809,288
31,443,299,687 25,510,180,650
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11.1 These finances are obtained from banking companies under mark-up arrangements and are secured by
hypothecation of all present and future current assets of the Holding Company and lien on export bills to the
extent of Rupees 37,294 million (2018: Rupees 32,096 million) and ranking charge on all present and future
current assets of the Holding Company to the extent of Rupees 1,132.667 million (2018: Rupees 4,786
million). These form part of total credit facilities of Rupees 28,065 million (2018: Rupees 26,765 million).
11.2 The rates of mark-up range from 7.02% to 14.05% (2018: 6.25% to 7.67%) per annum on the balance
11.3 The rates of mark-up on Pak Rupee finances and US Dollar finances range from 2.25% to 13.56% (2018:
2.25% to 6.89%) per annum and 3.00% to 3.30% (2018: 1.55% to 2%) per annum respectively on the
balance outstanding.
11.4 The rates of mark-up range from 6.14% to 13.25% (2018: 6.08% to 7.13% ) per annum on the balance
11.5 Finances from MCB Bank Limited - associated company have been utilized for working capital purposes.
11.6 These running financing facilities are obtained from banking companies under mark-up arrangement and are
secured against joint pari passu hypothecation charge of Rupees 1,000 million on all present and future
current assets of NC Electric Company Limited - Subsidiary Company and cross corporate guarantee of
Nishat (Chunian) Limited - Holding Company amounting to Rupees 1,320 million. Rates of mark-up range
from 7.71% to 14.12% (2018: 7.67%) per annum on the balance outstanding. Further, murabaha facility
available from a commercial bank amounted to Rupees 600 million (2018: Rupees 300 million). The amount
utilized as at 30 June 2019 was Rupees 365 million (2018: Rupees 300 million). The facility is secured
against joint pari passu hypothecation charge of Rupees 400 million on all present and future current assets
of NC Electric Company Limited - Subsidiary Company and cross corporate guarantee of Nishat (Chunian)
Limited - Holding Company amounting to Rupees 300 million. The rate of mark-up range from 6.81% to 14%
per annum on the balance outstanding.
11.7 These form part of total credit facilities (including for opening letters of credit and guarantees) of Rupees
1,525 million. The amount utilized by NC Electric Company Limited - Subsidiary Company as at 30 June
2019 was Rupees 583.660 million. The Holding Company has provided cross corporate guarantee of
Rupees 5,300 million to MCB Bank Limited - related party against facility for issuance of letters of credit.
11.8 Nishat Chunian USA Inc. - Subsidiary Company has a revolving credit pursuant to which it may borrow up to
US Dollars 2,500,000 (Rupees 410 million) subject to borrowing base availability, bearing interest at prime
rate plus 0.25% (5.25% at 30 June 2019). The borrowings base equals to 75% of the aggregate amount of all
qualified accounts receivable, as defined. This note is collateralized by as first security interest in
substantially all assets of the Nishat Chunian USA Inc. - Subsidiary Company and is guaranteed by the
Holding Company.
11.9 Running finance main facilities available from commercial banks under mark-up arrangements amount to
Rupees 7,250 million (2018: Rupees 8,250 million). Running finance facilities are available at mark-up rates
ranging from one month to three months KIBOR plus 0.15% to 2% per annum, payable quarterly. Running
finance facilities are secured against first joint pari passu hypothecation charge on the present and future
current assets of Nishat Chunian Power Limited - Subsidiary Company comprising of fuel stocks, inventories
and energy price payment receivables from NTDC. The mark-up rate charged during the year on the
outstanding balance ranges from 7.08% to 13.80% (2018: 6.29% to 8.50%) per annum.
11.10 Money market loans are available to Nishat Chunian Power Limited - Subsidiary Company as a sub-facility
to the running finance facility at mark-up rates ranging from one month to six months KIBOR plus 0.0% to
0.05% per annum. Money market loans are secured against first joint pari passu hypothecation charge on
the present and future current assets of Nishat Chunian Power Limited - Subsidiary Company comprising of
fuel stocks, inventories and energy price payment receivables from NTDC. The mark-up rate charged during
the year on the outstanding balance ranges from 7.12% to 13.12% (2018: 6.14% to 7.08%) per annum.

11.11 Murabaha and musharaka main facilities available from Islamic banks aggregate to Rupees 5,500 million
(2018: Rupees 4,500 million) at mark-up rates ranging from one week to six months KIBOR plus 0.1% to 1%
per annum. The amount utilised as at 30 June 2019, for musharaka facilities was Rupees 4,039.647 million
(2018: Rupees 1,548.190 million). Mark-up on murabaha is payable at the maturity of the respective
murabaha transaction, whereas, the mark-up on musharaka is payable quarterly on the balance outstanding.
The facilities are secured against first joint pari passu hypothecation charge on the present and future current
assets of Nishat Chunian Power Limited - Subsidiary Company comprising of fuel stocks, inventories and
energy price payment receivables from NTDC. The mark-up rate charged during the year on the outstanding
balance ranges from 7.03% to 13.30% (2018: 6.24% to 7.45%) per annum.
11.12 The main facilities for opening letters of credit and guarantees aggregate to Rupees 1,411.032 million (2018:
Rupees 1,411.032 million). The amount utilised at 30 June 2019, for letters of credit was Rupees 19.623
million (2018: Rupees 144.073 million) and for guarantees was Rupees 20.768 million (2018: Rupees 36.878
million). The aggregate facilities for opening letters of credit and guarantees are secured by ranking charge
on the present and future current assets comprising of fuel stocks, inventories and energy price payment
receivables from NTDC, counter guarantee, cash margin and lien over import documents.
2019 2018
Rupees Rupees
12. CURRENT PORTION OF NON-CURRENT LIABILITIES
Long term financing (Note 6) 4,615,738,167 4,675,185,917
13. CONTINGENCIES AND COMMITMENTS
13.1 Contingencies
13.1.1 The Holding Company preferred appeal against the Government of Punjab in the Honorable Lahore High
Court, Lahore against imposition of electricity duty on internal generation and the writ petition has been
accepted. However, Government of Punjab has moved to the Honourable Supreme Court of Pakistan
against the order of Honourable Lahore High Court, Lahore. The Holding Company has fully provided its
liability in respect of electricity duty on internal generation. As at the reporting date, an amount of Rupees
72.009 million (2018: Rupees 69.963 million) is payable on this account but the management of the Holding
Company is confident that payment of electricity duty will not be required.
13.1.2 The Collectorate of Customs (Export) has issued show cause notices with the intention to reject the duty
draw back claims aggregating to Rupees 9.482 million on blended grey fabrics exported under Duty and
Tax Remission Rules for Export (DTRE) scheme. The department is of the view that the Holding Company
has not submitted Appendix-1 as per Rule 297-A of the above referred scheme. The Holding Company
considers that since it has taken benefit of remission of sales tax only, it is entitled to full duty draw back and
filed appeal before Appellate Tribunal Inland Revenue (ATIR), Karachi Bench which was decided against the
Holding Company. The Holding Company also applied to Federal Board of Revenue (FBR) to constitute
Alternate Dispute Resolution Committee (ADRC) in terms of section 195C of the Customs Act, 1969 to settle
the dispute. ADRC vide its order dated 16 April 2008 has recommended the case in favour of the Holding
Company and forwarded the case to FBR. However, FBR has not accepted the recommendations of ADRC.
The Holding Company has filed appeal before the Honourable High Court of Sindh on 07 December 2013
against the order of ATIR. The appeal is pending decision.
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13.1.3 The Holding Company impugned selection of its tax affairs for audit in terms of section 177 of the Income
Tax Ordinance, 2001 for tax year 2009 in Honourable Lahore High Court, Lahore through writ petition. After
dismissal of writ petition by the Honourable Lahore High Court, Lahore, the tax department has completed
the audit of tax year 2009 of income tax affairs of the Holding Company and Deputy Commissioner Inland
Revenue (DCIR) has passed an order under sections 122(1)/122(5) of the Income Tax Ordinance, 2001
creating a tax demand of Rupees 6.773 million. The Holding Company has filed appeal before
Commissioner Inland Revenue (Appeals) [CIR(A)] against the decision of DCIR which is pending
adjudication. No provision against this demand has been made in these consolidated financial statements
as the Holding Company is hopeful of a favourable outcome of appeal based on the opinion of the tax
advisor.
13.1.4 As a result of withholding tax audit for the tax year 2006, DCIR has raised a demand of Rupees 32.156 million
under sections 161 and 205 of the Income Tax Ordinance, 2001. The Holding Company's appeal before
ATIR was successful. The Holding Company also challenged the initiation of proceedings, under sections
161 and 205 of the Income Tax Ordinance, 2001 pertaining to tax years 2007, 2008, 2009, 2010, 2011 and
2012 in the Honourable Lahore High Court, Lahore through a writ petition. The Honourable Lahore High Court,
Lahore directed the Tax Department to issue notice for reconciliation and in case default is established only
then action under section 205 of the Income Tax Ordinance, 2001 can be taken. The Holding Company also
filed intra court appeals to the Honourable Lahore High Court, Lahore, which were dismissed. Against this
dismissal, appeal has been filed before the Supreme Court of Pakistan which is pending adjudication. The
management of the Holding Company believes that the favourable outcome of its appeal before ATIR, in
respect of tax year 2006 on same issues, will dispose of the initiation of these proceedings. In respect of tax
year 2012, the case has been decided at departmental level as stated in Note 13.1.7, hence appeal filed
before the Supreme Court of Pakistan in respect of tax year 2012 shall be withdrawn shortly.
13.1.5 The Holding Company is in appeal before ATIR as its appeal before CIR(A) against the order of Additional
Commissioner Inland Revenue (ACIR) was unsuccessful. ACIR has passed an order under section 122(5A)
of the Income Tax Ordinance, 2001 for tax year 2011 whereby a demand of Rupees 6.822 million has been
raised. No provision against the demand has been made in these consolidated financial statements as the
Holding Company is hopeful of a favourable outcome of appeal based on opinion of the tax advisor.
13.1.6 The Deputy Collector (Refund – Gold) by order dated 16 May 2007 rejected the input tax claim of the
Holding Company, for the month of June 2005, amounting to Rupees 1.604 million incurred in zero rated
local supplies of textile and articles thereof on the grounds that the input tax claim is in contravention of SRO
992(I)/2005 which states that no registered person engaged in the export of specified goods (including
textile and articles thereof) shall, either through zero-rating or otherwise, be entitled to deduct or reclaim
input tax paid in respect of stocks of such goods acquired up to 05 June 2005, if not used for the purpose of
exports made up to the 31 December 2005. The appeal of the Holding Company before ATIR was
successful and input tax claim of the Holding Company is expected to be processed after necessary
verification in this regard. Pending the outcome of verification no provision for inadmissible input tax has
been recognized in these consolidated financial statements.
13.1.7 The ACIR through an order under section 161/205 of the Income Tax Ordinance, 2001 created a demand of
Rupees 147.745 million for tax year 2012 on account of alleged non-deduction of income tax on payments
against the heads commission to selling agents on exports and export marketing expenses. Being
aggrieved, the Holding Company filed an appeal before CIR(A), who vide order dated 09 June 2016
accepted the stance of the Holding Company and deleted the demand related to commission to selling
agents on exports, whereas, with respect to export marketing expenses, CIR(A) remanded back the case to
ACIR. However, the Holding Company has filed appeal before ATIR which is pending for fixation. Based on
grounds and facts, the appeal is likely to be decided in favour of the Holding Company. The demand
created under section 161/205 of the Income Tax Ordinance, 2001 of tax year 2012 amounting to Rupees
147.745 million by ACIR was subsequently reduced to Rupees 165,593 through appeal effect order issued
by ACIR.
13.1.8 The Holding Company filed appeal before CIR(A) against the order of ACIR. ACIR passed an order under
section 122(5A) of the Income Tax Ordinance, 2001 for tax year 2012 whereby a demand of Rupees 125.162
million has been raised. CIR(A) vide order dated 29 June 2016 has deleted some of the additions made by
ACIR. Being aggrieved by the order of CIR(A), the Holding Company as well as the tax department have
preferred appeals before the ATIR which are pending adjudication. No provision against this demand has
been made in these consolidated financial statements as the Holding Company is hopeful for a favourable
outcome of appeal based on the opinion of the tax advisor.
13.1.9 The Holding Company filed appeal before CIR(A) against the order of ACIR. ACIR passed an order under
section 122(5A) of the Income Tax Ordinance, 2001 for tax year 2010 whereby a demand of Rupees 142.956
million has been raised. CIR(A) vide order dated 28 October 2016 has deleted some of the additions made
by ACIR. Being aggrieved by the order of CIR(A), the Holding Company as well as the tax department have
preferred appeals before the ATIR which are pending adjudication. No provision against this demand has
been made in these consolidated financial statements as the Holding Company is hopeful for a favourable
13.1.10 The Deputy Commissioner Inland Revenue passed an order under sections 161/205 of the Income Tax
Ordinance, 2001 creating a demand of Rupees 19.073 million for the tax year 2014. The Holding Company
preferred an appeal against this order before CIR(A). The CIR(A) adjudicated that impugned order is
unsustainable and remanded back the matter to taxation officer for consideration of legal grounds and merits
of the case. The Holding Company has also filed an appeal before ATIR against the order of CIR(A). The
proceedings before both forums are pending for adjudication. No provision against this demand has been
made in these consolidated financial statements as the Holding Company is confident of favorable outcome
of its appeals
13.1.11 Through show cause notice, the Collector of Customs, Karachi raised demand of Rupees 23.585 million on
the grounds that the Holding Company was not entitled for exemption of sales tax and facility of reduced rate
of income tax on 13 consignments of cotton imported during the period from April 2013 to April 2014. The
vires of show cause notice were challenged in Honorable Sindh High Court at Karachi from where stay was
granted with the direction to the Collector that he will not pass final order pursuant to the impugned show
cause notice particularly in respect of advance income tax till next date of hearing. In spite of the categorical
orders of the Honorable High Court, the Collector passed order, creating the demand of the aforesaid
amount. Appeal against the said order filed in ATIR, Karachi has been dismissed. Custom reference
application has been filed in Sindh High Court, Karachi against the order of ATIR. There is sufficient case law
on the subject and there is every likelihood that case will be decided in favour of the Holding Company.
13.1.12 The Holding Company is contesting sales tax demands / rejections of sales tax by taxation authorities
amounting to Rupees 7.098 million at various forums. These demands have been raised on account of
various issues, like refund of sales tax on purchases of furnace oil and diesel, non-provision of documents
against certain refund processing system objections and supplies made to certain parties. No provision
against the aforesaid demands has been made in these consolidated financial statements as the
management is confident of favourable outcome of its appeals based on advice of the legal counsel. The
name of the Holding Company was selected by the FBR through balloting for audit of its sales tax record of
tax year 2014. Writ petition against the selection was filed and in pursuance of Court's order, the record was
submitted to the assessing officer. Based on the audit, Deputy Commissioner has issued a show cause
notice on account of alleged discrepancies/observations noted during audit to the tune of Rupees 7.480
million. The Holding Company has challenged the vires of show cause notice in Lahore High Court, Lahore
and expects favorable outcome of the matter, hence no provision has been recognized in these consolidated
13.1.13 Being aggrieved, the Holding Company is in appeal before ATIR against the order of CIR(A). The ACIR has
passed an order under section 122(5A) of the Income Tax Ordinance, 2001 for tax year 2013 whereby a
demand of Rupees 27.845 million has been raised. The appeal before CIR(A) has been decided and some
matters have been decided in favour of the Holding Company. No provision against this demand has been
made in these consolidated financial statements as the Holding Company is hopeful for a favourable
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13.1.14 The DCIR issued a show cause notice dated 12 April 2019 under section 177(1) of the Income Tax
Ordinance, 2001 for providing certain record and documents for tax year 2013. In response thereto, various
replies were submitted with the DCIR. In response to submissions of the Holding Company, the DCIR issued
an audit report u/s 177(6) of the Income Tax Ordinance, 2001 and then passed an order under sections
122(4)/122(5)/214C of the Income Tax Ordinance, 2001 creating a demand of Rupees 277.772 million. Being
aggrieved with the order passed by the DCIR, an appeal has been filed before CIR(A)-I which is pending for
fixation. However, the outcome of the appeal is expected to be decided in favour of the Holding Company.
13.1.15 The DCIR issued a show cause notice dated 20 March 2019 under section 161(1A) of the Income Tax
Ordinance, 2001 for tax year 2017, wherein, the Holding Company was required to explain the taxes
deducted against payments amounting to Rupees 133.361 million made on account of commission to selling
agents. In response thereto, a reply dated 28 March 2019 was submitted with the DCIR. The DCIR without
considering the arguments putforth by the Holding Company passed an order dated 05 April 2019 raising a
demand of Rupees 13.982 million. Being aggrieved with the order passed by the DCIR, an appeal was filed
before CIR(A)-I which culminated in an order under section 129(1)(b) read with section 161(1A) of Income Tax
Ordinance, 2001 dated 27 June 2019, wherein, the stance of the DCIR was upheld. Being aggrieved with the
order passed by the CIR(A)-I, an appeal was filed before ATIR, the outcome of which is expected to be
decided in favour of the Holding Company.
13.1.16 The DCIR issued a show cause notice dated 20 March 2019 under section 161(1A) of the Income Tax
Ordinance, 2001 for tax year 2018, wherein, the Holding Company was required to explain the taxes
deducted against payments amounting to Rupees 213.382 million made on account of commission to selling
agents. In response thereto, a reply dated 28 March 2019 was submitted with the DCIR. The DCIR without
considering the arguments putforth by the taxpayer, passed an order dated 05 April 2019 raising a demand
to the tune of Rupees 15.130 million. Being aggrieved with the order passed by DCIR, an appeal was filed
before CIR(A)-I which culminated in an order under section 129(1)(b) read with section 161(1A) of Income Tax
Ordinance, 2001 dated 27 June 2019, wherein, the stance of the DCIR was upheld. Being aggrieved with the
order passed by the CIR(A)-I, an appeal was filed before ATIR, the outcome of which is expected to be
decided in favour of the Holding Company.
13.1.17 The Holding Company has challenged, before Honourable Lahore High Court, Lahore, the vires of first
proviso to sub-clause (x) of clause (4) of SRO 491(1)/2016 dated 30 June 2016 issued under sections 3 and
4 read with sections 8 and 71 of the Sales Tax Act, 1990 whereby through amendment in the earlier SRO
1125(I)/2011 dated 31 December 2011 adjustment of input sales tax on packing material of all sorts has
been disallowed. The learned single judge of Honourable Lahore High Court has dismissed the writ petition
of the Holding Company therefore intra court appeal has been filed. The Holding Company has claimed
input sales tax amounting to Rupees 178.417 million (2018: Rupees 178.417 million) paid on packing
material in its respective monthly sales tax returns. The management, based on advice of the legal counsel,
is confident of favorable outcome of its appeal.
13.1.18 Guarantees of Rupees 671.04 million (2018: Rupees 609.109 million) are given by the banks of the Holding
Company to Sui Northern Gas Pipelines Limited against gas connections, Shell Pakistan Limited against
purchase of furnace oil, Lahore Electric Supply Company against electricity connections, Director Excise
and Taxation, Karachi against infrastructure cess, Chairman Punjab Revenue Authority, Lahore against
infrastructure cess, Director Pakistan Central Cotton Committee against cotton cess, and Nazir, Honourable
High Court, Sindh against the notification in accordance with section 8 of OGRA Ordinance 2002, regarding
system gas tariff on industrial and captive units.
13.1.19 Post dated cheques have been issued to custom authorities in respect of duties amounting to Rupees
3,544.173 million (2018: Rupees 3,234.598 million) on imported material availed on the basis of consumption
and export plans. In the event the documents of exports are not provided on due dates, cheque issued as
security shall be encashable.
13.1.20 The Holding Company has issued cross corporate guarantees of Rupees 12.295 billion (2018: Rupees
14.520 billion) on behalf of NC Electric Company Limited - Subsidiary Company to secure the obligations of
Subsidiary Company towards its lenders.
13.1.21 During the financial year 2014, a sales tax demand of Rupees 1,161.548 million was raised against Nishat
Chunian Power Limited - Subsidiary Company through order dated 28 November 2013, by the Assistant
Commissioner Inland Revenue (‘ACIR’) by disallowing input sales tax for the tax periods from July 2010 to
June 2012. Such amount was disallowed on the grounds that the revenue derived by Nishat Chunian Power
Limited - Subsidiary Company on account of ‘capacity purchase price’ was against a non-taxable supply
and thus, the entire amount of input sales tax claimed by the Nishat Chunian Power Limited - Subsidiary
Company was required to be apportioned with only the input sales tax attributable to other revenue stream
i.e. ‘energy purchase price’ admissible to Nishat Chunian Power Limited - Subsidiary Company. Against the
aforesaid order, Nishat Chunian Power Limited - Subsidiary Company preferred an appeal dated 10
December 2013 before the Commissioner Inland Revenue (Appeals) (‘CIR(A)’) who vacated the ACIR’s
order on the issue regarding apportionment of input sales tax. However, the CIR(A) did not adjudicate upon
Nishat Chunian Power Limited - Subsidiary Company's other grounds of appeal. Consequently, Nishat
Chunian Power Limited - Subsidiary Company preferred an appeal on 17 March 2014 before the Appellate
Tribunal Inland Revenue (‘ATIR’) on the issues not adjudicated upon by the CIR(A) and the Department also
preferred a second appeal on 08 May 2014 before the ATIR against the CIR(A)’s order, both of which are
pending adjudication. The ATIR decided the case in favour of Nishat Chunian Power Limited - Subsidiary
Company on 11 September 2018. However, FBR has filed a sales tax reference with Lahore High Court
('LHC") against the decision of the ATIR. The matter is pending adjudication till date.
Furthermore, during the financial year 2015, the Deputy Commissioner Inland Revenue (‘DCIR’) issued a
show cause notice dated 12 November 2014, whereby intentions were shown to raise a sales tax demand
of Rupees 1,093.262 million by disallowing input sales tax claimed by Nishat Chunian Power Limited -
Subsidiary Company for the tax periods from July 2010 to June 2012 on similar grounds as explained
above. Nishat Chunian Power Limited - Subsidiary Company agitated the initiation of such proceedings
through institution of a writ petition before the Lahore High Court ('LHC') on 23 July 2015. During the year
2017, LHC disposed off the petition in the Subsidiary Company's favour through its order dated 31 October
2016, by stating that there is no supply being made against capacity purchase price, hence, there is no
existence of an “exempt supply”. Accordingly, the Subsidiary Company is free to reclaim or deduct input tax
under the relevant provisions of Sales Tax Act, 1990. However, the tax department filed a review petition
before the LHC on 09 January 2017 and an appeal before the Supreme Court of Pakistan on 24 November
2017 against the aforementioned LHC's order, both of which are pending adjudication.
For the period July 2013 to June 2014, Subsidiary Company’s case was selected for audit by ‘Federal
Board of Revenue’ (‘FBR’), which selection was objected to, on jurisdictional basis, by Subsidiary Company
by way of filing a writ petition before LHC on 20 November 2015. While, LHC has allowed the department to
proceed with audit proceedings, it has been directed that no adjudication order, consequent to conduct of
audit, shall be passed after confronting the audit report. The audit proceedings were completed by the
department during the financial year 2016 and audit report thereof was submitted to the Subsidiary Company
seeking explanations in regard to the issues raised therein. In the subject audit report, an aggregate amount
of Rupees 631.769 million primarily including a disallowance of input sales tax of Rupees 622.263 million has
been confronted on same grounds as explained above. LHC through its order dated 09 January 2017 has
allowed initiation of adjudication proceedings after issuance of audit report. On 17 May 2017, the DCIR
issued a showcause notice as to why sales tax of the aforesaid amount of Rupees 631.769 million alongwith
default surcharge should not be recovered from the Subsidiary Company. The Subsidiary Company has
filed a representation in this regard with the Chairman, Federal Board of Revenue. The Chairman FBR
disposed of the case on the grounds that it did not invoke any provision of Section 7 FBR Act 2007 as no
issue of misadministration is involved therein. The Subsidiary Company then challenged the show cause
notice before the Honourable Lahore High Court. The Lahore High Court declared on 09 November 2018 that
the show cause was issued without having jurisdiction. No further notice has been received with regards to
this case as at the year end 30 June 2019.
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13.1.22 During the last year, an amendment order dated 31 August 2017 was issued by the DCIR under section 122
of the Income Tax Ordinance, 2001 ('ITO') for Tax Year 2014 whereby income tax of Rupees 191.536 million
was levied on other income, interest on delayed payments from NTDC, minimum tax on capacity sales,
scrap sales and sale proceeds of fixed assets' disposal, and WWF was also levied of Rupees 12.946
million. Against the aforesaid order, Nishat Chunian Power Limited - Subsidiary Company preferred an
appeal on 25 September 2017 before the CIR(A) and the learned CIR(A) passed an order on 02 February
2018, declaring that the levy of income tax on interest on delayed payments from NTDC and minimum tax on
capacity sales is not justified, while directing the Subsidiary Company to pay income tax aggregating to
Rupees 1.466 million on profit on debt, miscellaneous income, capital gain on disposal of securities,
minimum tax on scrap sales and fixed assets' disposal, and WWF of Rupees 4.552 million. The Subsidiary
Company and tax authority both have filed appeals on 08 March 2018 and 26 March 2018 respectively,
before the ATIR against the order of CIR(A) that are pending adjudication.
Further, another amendment order dated 13 June 2018 was issued by the Additional Commissioner Inland
Revenue under section 122 of the ITO for Tax Year 2012 and subsequently, rectification order dated 27 June
2018 under section 221 of the ITO was issued whereby income tax of Rupees 50.063 million was levied
mainly comprising minimum tax on capacity sales. Subsequent to year end, the Subsidiary Company has
filed an appeal on 26 July 2018 before the CIR(A) against the aforesaid orders, which is pending
adjudication.
The management considers that there exist meritorious grounds to defend Nishat Chunian Power Limited -
Subsidiary Company’s stance and the ultimate decision from the appellate authorities would be in the
Subsidiary Company's favour. Consequently, no provision has been made in these consolidated financial
statements for the above mentioned amounts aggregating Rupees 254.545 million.
13.1.23 Guarantees of Rupees 27.683 million (2018: Rupees 17.683 million) have been issued by banks of NC
Electric Company Limited - Subsidiary Company in favour of Director, Excise and Taxation, Karachi against
disputed amounts of infrastructure cess.
13.1.24 The following has been issued by the bank on behalf of Nishat Chunian Power Limited - Subsidiary
Company:
(a) Letter of guarantee of Rupees 20.978 million (2018: Rupees 18.942 million) in favour of Director,
Excise and Taxation, Karachi under direction of Sindh High Court in respect of suit filed for levy of
infrastructure cess.
13.1.25 Post dated cheques amounting to Rupees 8.230 million (2018: Rupees 8.230) have been issued by NC
Electric Company Limited - Subsidiary Company in favour of Collector of Customs against disputed amount
of tax on import of coal.
13.1.26 A civil / construction work contractor has filed suit for recovery of Rupees 191.554 million as the amount of
work done, Rupees 61.938 million as interest and Rupees 70 million as loss of opportunity in the Court of
Civil Judge, Lahore. According to the scheme of the contracts, the entire civil / construction work was to be
performed by the civil / construction work contractor. NC Electric Company Limited - Subsidiary Company
was under obligation to make payment after verification of the work by the Engineering and Procurement
Contractor (E&P Contractor). The E&P Contractor has not conducted verification of work and until and unless
the verification was to be completed, the amounts of civil / construction work contractor are not to be
released / paid, hence the suit is liable to be dismissed.

13.2 Contingent asset
On 29 July 2017, Nishat Chunian Power Limited - Subsidiary Company instituted arbitration proceedings
against NTDC / Government of Pakistan by filing a Request for Arbitration ('RFA') with the London Court of
International Arbitration ('LCIA') (the 'Arbitration Proceedings') for disallowing an amount of Rupees 1,161.535
million relating to delayed payment charges on outstanding delayed payment invoices. Nishat Chunian
Power Limited - Subsidiary Company believes it is entitled to claim delayed payment charges on
outstanding delayed payments receivables from NTDC as per terms of the PPA. However, NTDC has
denied this liability and objected on the maintainability of the Arbitration Proceedings, terming it against the
PPA and refused to pay delayed payment charges on outstanding delayed payments receivables.
The LCIA appointed a sole Arbitrator and hearings were also held on 19 February 2018 and 20 February
2018. On 16 April 2018, the Arbitrator has issued Partial Final Award in which he has rejected the NTDC’s
objection to the maintainability of the Arbitration Proceedings.
While the Arbitration Proceedings on merits of the case are underway, the Nishat Chunian Power Limited -
Subsidiary Company has submitted the Partial Final Award before LHC and obtained interim relief from
Honourable LHC, whereby, LHC has restrained NTDC from taking steps for delaying the arbitration
proceedings and challenging the award in Civil Courts of Pakistan. As the above amount is disputed,
therefore, on prudence basis, the Nishat Chunian Power Limited - Subsidiary Company has not recognized
the income and corresponding asset for these amounts in these consolidated financial statements.
13.3 Commitments:
13.3.1 Letters of credit other than for capital expenditure amounting to Rupees 879.094 million (2018: Rupees
1,506.921 million).
13.3.3 Outstanding foreign currency forward contracts of Rupees 288.140 million (2018: Rupees 418.294 million).
13.3.5 The Nishat Chunian USA, Inc. - Subsidiary Company is obligated under an operating lease for its office
which expires on 31 January 2021. Future minimum lease commitments under the non-cancellable lease,
are approximately Rupees 19.993 million.
2019 2018
Rupees Rupees
14. FIXED ASSETS

Property, plant and equipment:
Operating fixed assets (Note 14.1) 27,075,527,443 28,285,126,311

Capital work-in-progress (Note 14.2) 326,135,243 74,269,238
27,401,662,686 28,359,395,549
2019 139 Nishat

Nishat (Chunian)
(Chunian) Limited
14.1 Reconciliations of carrying amounts of operating fixed assets at the beginning and at the end of the year are as follows:
Operating fixed assets
Description Buildings on Plant and Standby Electric Furniture, fixture Office
Freehold land Factory equipment Motor vehicles Total
freehold land machinery generators installations and equipment equipment
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - -- - - - - - - - - - - - - - - - R u p e e s - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
At 30 June 2017
Cost 900,509,733 4,644,759,818 36,473,018,031 964,154,094 641,011,426 259,307,346 114,881,574 146,846,606 248,855,870 44,393,344,498
Net book value 900,509,733 3,400,755,374 24,157,365,086 338,400,123 380,673,980 122,745,805 60,128,201 75,233,536 135,695,188 29,571,507,026

Additions 10,806,400 95,344,611 903,667,842 5,619,341 31,058,022 11,668,521 24,071,435 16,703,349 34,957,164 1,133,896,685
Disposals:
Cost - - (780,777,458) - (10,000) - (619,756) (1,799,420) (59,304,810) (842,511,444)
Accumulated depreciation - - 735,181,471 - 7,641 - 508,652 669,576 32,234,675 768,602,015
- - (45,595,987) - (2,359) - (111,104) (1,129,844) (27,070,135) (73,909,429)
Depreciation charge - (158,983,043) (2,035,113,333) (33,182,875) (40,429,493) (13,064,017) (10,079,464) (18,994,707) (36,521,039) (2,346,367,971)
At 30 June 2018
Cost 911,316,133 4,740,104,429 36,595,908,415 969,773,435 672,059,448 270,975,867 138,333,253 161,750,535 224,508,224 44,684,729,739
Net book value 911,316,133 3,337,116,942 22,980,323,608 310,836,589 371,300,150 121,350,309 74,009,068 71,812,334 107,061,178 28,285,126,311

Additions 74,560,360 6,240,542 1,233,216,514 2,718,947 17,181,248 4,277,001 24,093,317 12,176,834 40,449,712 1,414,914,475
Disposals:
Cost - - (715,995,702) - - - - (1,808,276) (13,183,470) (730,987,448)
Accumulated depreciation - - 715,631,395 - - - - 781,708 10,696,996 727,110,099
- - (364,307) - - - - (1,026,568) (2,486,474) (3,877,349)
Derecognition of assets of Subsidiary Company:
Cost - - (494,397,870) - (4,649,850) - - (9,163,621) (2,486,427) (510,697,768)
Accumulated depreciation - - 126,891,431 - 1,192,308 - - 4,097,636 309,705 132,491,080
- - (367,506,439) - (3,457,542) - - (5,065,985) (2,176,722) (378,206,688)
Depreciation charge - (155,736,902) (1,975,533,266) (2,970,777) (38,167,264) (12,382,495) (11,390,305) (16,349,937) (29,898,360) (2,242,429,306)
At 30 June 2019

Cost 985,876,493 4,746,344,971 36,618,731,357 972,492,382 684,590,846 275,252,868 162,426,570 162,955,472 249,288,039 44,857,958,998
Net book value 985,876,493 3,187,620,582 21,870,136,110 310,584,759 346,856,592 113,244,815 86,712,080 61,546,678 112,949,334 27,075,527,443
Nishat (Chunian)
4 - 15 and number Number of
Annual rate of depreciation (%) 4 - 10 of hours used hours used 10 - 20 10 10 - 20 10 - 33 20
140
2019 Limited
2019
141
Nishat
14.1.1 Detail of operating fixed assets, exceeding the book value of Rupees 500,000, disposed of during the year is as follows:
Accumulated
Description Qty Cost Net book value Sale proceeds Gain / (loss) Mode of disposal Particulars of purchasers
Nishat (Chunian)
depreciation
- - - - - - - - - - - - - - - - - - - - - - - - - Rupees - - - - - - - - - - - - - - - - - - - - - - - - -
(Chunian) Limited
Motor vehicles
Cultus VXL LEH-17-5836 1 1,417,010 (393,378) 1,023,632 1,042,720 19,088 Group's policy Mr. Imran Raza (Ex-employee), Lahore

Aggregate of other items of
operating fixed assets with
individual book values not
exceeding Rupees 500,000 729,570,436 (726,716,720) 2,853,716 8,637,035 5,783,319
730,987,446 (727,110,098) 3,877,348 9,679,755 5,802,407
2019 2018
Rupees Rupees
14.1.2 The depreciation charge for the year has been allocated as follows:
Cost of sales (Note 27) 2,224,505,816 2,320,370,231
Administrative expenses (Note 29) 17,923,490 25,997,740
2,242,429,306 2,346,367,971
14.1.3 Particulars of immovable fixed assets are as follows:
Manufacturing units and office Address Area of land
Acres
Manufacturing units
Spinning Units 1,4,5,7 and 8 49th Kilometer, Multan Road, Bhai Pheru, Tehsil Chunian, 45.83
District Kasur.
Spinning Units 2,3,6 and Weaving 49th Kilometer, Multan Road, Kamogal, Tehsil Pattoki, District 65.20
Kasur.
Dyeing, Printing and Stitching 4th Kilometer, Manga Road, Raiwind. 34.78
Office 31-Q, 31-C-Q, 35-K and 10-N, Gulberg-II, Lahore. 2.02
NC Electric Company Limited - Subsidiary Company
Coal fired electric power 49th Kilometer, Multan Road, Bhai Pheru, Tehsil Chunian, 29.35
generation project District Kasur.
Freehold land Jamber Kalan, Tehsil Pattoki, District Kasur. 24.59
2019 2018
Rupees Rupees
14.2 Capital work-in-progress
Civil works on freehold land 5,429,275 1,803,210
Plant and machinery 1,440,400 -
Mobilization advance 9,779,869 137,500
Letters of credit - 39,324
Advances for capital expenditure 309,485,699 72,289,204
326,135,243 74,269,238
Nishat (Chunian)
Nishat (Chunian) Limited Limited
and its subsidiaries 142 2019
2019 2018
Rupees Rupees
15. INTANGIBLE ASSETS
Addition during the year - 3,480,645
Amortization during the year (5,513,305) (7,237,056)
Derecognition of asset of Subsidiary Company (5,002,001) -
As at 30 June 9,199,464 19,714,770
Cost as at 30 June 52,669,448 52,669,448

Accumulated amortization (38,467,983) (32,954,678)
Derecognition of asset of Subsidiary Company:
Cost (6,849,636) -
Accumulated amortization 1,847,625 -
(5,002,011) -
Net book value as at 30 June 9,199,454 19,714,770
15.1 Amortization on intangible assets amounting to Rupees 3.993 million (2018: Rupees 4.460 million) and Rupees 1.520
million (2018: Rupees 2.777 million) has been allocated to cost of sales and administrative expenses, respectively.
15.2 Intangible assets have been amortized at the rates ranging from 20% - 30% per annum.
2019 2018
Rupees Rupees
16. LONG TERM INVESTMENT
Debt instrument
At amortized cost
Sales tax refund bonds (Note 16.1)
2,209 (2018: Nil) bonds of Rupees 100,000 each 220,900,000 -
Add: Accrued interest (Note 31) 1,704,840 -
222,604,840 -
16.1 These represent investment in sales tax refund bonds having maturity period of three years issued by FBR Refund
Settlement Company Limited under Section 67A of the Sales Tax Act, 1990 against sales tax refund payment orders
issued in favour of the Holding Company. These bonds are carried at amortized cost using effective interest at the
rate of 9.14% per annum.
2019 2018
Rupees Rupees
17. LONG TERM LOANS TO EMPLOYEES
Considered good:
Executives (Note 17.2) 16,082,518 16,440,318

Other employees (Note 17.2) 7,442,814 5,314,547
23,525,332 21,754,865
Less: Current portion shown under current assets (Note 21)
Executives 3,107,262 2,929,227

Other employees 1,453,775 928,411
4,561,037 3,857,638
18,964,295 17,897,227
17.1 Maximum aggregate balance due from executives at the end of any month during the year was Rupees 17.071
million (2018: Rupees 22.994 million).
2019 143 Nishat
Nishat (Chunian)
(Chunian) Limited
17.2 These represent motor vehicle loans and house building loans to executives and employees, payable in 36 to 48,
96 monthly instalments respectively. Interest on long term loans ranged from 3.1% to 13.79% (2018: 3.1% to 10.66%)
per annum while some loans are interest free. Motor vehicle loans are secured against registration of motor vehicles
in the name of the respective Group Company, whereas house building loans are secured against balance standing
to the credit of employee in the provident fund trust account.
2019 2018
Rupees Rupees
18. STORES, SPARE PARTS AND LOOSE TOOLS
Stores (Note 18.1) 1,249,488,029 1,039,711,185

Spare parts 333,498,032 272,408,584
Loose tools 57,875,028 52,183,148
1,640,861,089 1,364,302,917
18.1 Most of the items of stores and spares of Nishat Chunian Power Limited - Subsidiary Company and NC Electric
Company Limited - Subsidiary Company are of interchangeable nature and can be used as machine spares or
consumed as stores. Accordingly, it is not practicable to distinguish stores from spares until their actual usage.
Moreover, stores and spares include items which may result in fixed capital expenditure but are not distinguishable.
2019 2018
Rupees Rupees
19. STOCK-IN-TRADE
Raw materials 13,398,132,698 9,958,948,023

Work-in-process 1,039,191,965 902,207,503
Finished goods 3,577,038,911 1,788,352,893
Waste 60,348,016 106,915,432
18,074,711,590 12,756,423,851
19.1 Stock-in-trade of Rupees 122.130 million (2018: Rupees 245.976 million) is being carried at net realizable value.
19.2 This includes stock of Rupees 47.004 million (2018: Rupees 29.635 million) sent to outside parties for processing.
19.3 Finished goods include stock in transit of Rupees 808.954 million (2018: Rupees Nil).
2019 2018
Rupees Rupees
20. TRADE DEBTS
Considered good:
Secured (Note 20.5)

- Others 19,957,518,537 18,291,242,460
Unsecured
- Nishat Mills Limited - related party 109,025,662 39,471,265
- Others 946,901,451 873,619,555
1,055,927,113 913,090,820
Less: Allowance for expected credit losses (Note 20.4) (5,049,905) -
21,008,395,745 19,204,333,280
20.1 The maximum aggregate amount receivable from related party at the end of any month during the year was as

20.2 As at 30 June 2019, trade debts of Rupees 11,780.817 million (2018: Rupees 7,605.748 million) were past due but
not impaired. These relate to a number of independent customers from whom there is no recent history of default.
The age analysis of these trade debts is as follows:
2019 2018
Rupees Rupees
Upto 1 month 1,300,783,648 1,718,607,838
1 to 6 months 5,269,987,449 4,546,371,883
More than 6 months 5,210,046,020 1,340,767,977
11,780,817,117 7,605,747,698
20.3 As at 30 June 2018, trade debts due from related party amounting to Rupees 33.707 million (2018: Rupees Nil) were
past due but not impaired. The age analysis of these trade debts is as follows:
Upto 1 month 33,707,017 -

1 to 6 months - -
More than 6 months - -
33,707,017 -
20.4 Allowance for expected credit losses
Opening balance - -
Add: Recongnized as on 01 July 2018 5,288,510 -
Add: Reversal during the year (Note 30) (238,605) -
Closing balance 5,049,905 -
20.5 Included in trade debts is an amount of Rupees 966.166 million relating to capacity purchase price not
acknowledged by NTDC as the plant of Nishat Chunian Power Limited - Subsidiary Company was not fully available
for power generation. However, the sole reason of this under-utilization of plant capacity was non-availability of fuel
owing to non-payment by NTDC.
Since management considers that the primary reason for claiming these payments is that plant was available,
however, could not generate electricity due to non-payment by NTDC, therefore, management believes that Nishat
Chunian Power Limited - Subsidiary Company cannot be penalized in the form of payment deductions due to
NTDC’s default of making timely payments under the PPA. Hence, Nishat Chunian Power Limited - Subsidiary
Company had taken up this issue at appropriate forums. On 28 June 2013, Nishat Chunian Power Limited -
Subsidiary Company entered into a Memorandum of Understanding ('MoU') for cooperation on extension of credit
terms with NTDC whereby it was agreed that the constitutional petition filed by Nishat Chunian Power Limited -
Subsidiary Company before the Supreme Court of Pakistan on the above mentioned issue would be withdrawn
unconditionally and it would be resolved through the dispute resolution mechanism under the PPA. Accordingly, as
per terms of the MoU, Nishat Chunian Power Limited - Subsidiary Company applied for withdrawal of the aforesaid
petition in 2013 and on 25 January 2018, the Supreme Court disposed off the petitions filed before it. During the
financial year 2014, Nishat Chunian Power Limited - Subsidiary Company in consultation with NTDC, appointed an
Expert for dispute resolution under the PPA.
During the financial year 2016, the Expert gave his determination whereby the aforesaid amount was determined to
be payable to Nishat Chunian Power Limited - Subsidiary Company by NTDC. Pursuant to the Expert’s determination,
the Subsidiary Company demanded the payment of the aforesaid amount of Rupees 966.166 million from NTDC that
has not yet been paid by NTDC. Nishat Chunian Power Limited - Subsidiary Company filed a request for arbitration in
the London Court of International Arbitration ('LCIA'), whereby an Arbitrator was appointed. In October 2015, the
Government of Pakistan ('GOP') through Private Power & Infrastructure Board ('PPIB') filed a case in the court of
Senior Civil Judge, (“Civil Case 2015”), Lahore, against the aforementioned decision of the Expert, praying it to be
illegal, which is pending adjudication.
2019 145 Nishat

Nishat (Chunian)
(Chunian) Limited
Consequently, invitation to participate in arbitration was issued to the PPIB / GOP. PPIB filed separate Civil Suit
before the Civil Judge, Lahore, seeking inter alia that the parties should be restrained from participating in the
arbitration proceedings in the LCIA (“Civil Case 2016”). Nishat Chunian Power Limited - Subsidiary Company filed
applications in the Civil Court where Nishat Chunian Power Limited - Subsidiary Company prayed that the Civil Court,
Lahore lacks the jurisdiction in respect of the cases filed by PPIB. In respect of the aforementioned applications,
through its orders dated 18 April 2017, the Civil Court, Lahore rejected Nishat Chunian Power Limited - Subsidiary
Company's pray and granted the pray of PPIB whereby, the court accepted PPIB’s applications for interim relief in
2015 and 2016 civil suits. Being aggrieved, Nishat Chunian Power Limited - Subsidiary Company challenged before
the Additional District Judge, Lahore against the aforementioned orders of the Civil Court and continued to take part
in the arbitration proceedings. Furthermore, in response to Nishat Chunian Power Limited - Subsidiary Company's
continued participation in the arbitration proceedings, PPIB filed contempt petition before Lahore High Court (LHC) in
respect of the decision of the Civil Court, Lahore and the LHC passed an order in those proceedings. Nishat Chunian
Power Limited - Subsidiary Company challenged the LHC’s order before the Division Bench of LHC, which decided
the matter in favour of Nishat Chunian Power Limited - Subsidiary Company through its order dated 31 May 2017
whereby, the aforementioned order of the LHC was suspended.
The Arbitrator, on 08 June 2017, declared his Partial Final Award and decided the matter principally in Nishat Chunian
Power Limited - Subsidiary Company's favour and declared that the above mentioned Expert's determination is final
and binding on all parties (“Final Partial Award”). Aggrieved by the Partial Final Award, NTDC challenged the
Arbitrator’s decision in Lahore Civil Court (“Civil Case 2017”), which suspended the Final Partial Award on 10 July
2017. In response to this decision of Civil Court, the Nishat Chunian Power Limited - Subsidiary Company filed a
revision petition in District Court and the District Court (“District Case 2017”) while granting interim relief to the Nishat
Chunian Power Limited - Subsidiary Company, suspended the Civil Court’s order on 12 August 2017. Alongwith
challenging the Final Partial Award in Lahore Civil Court, NTDC also challenged the same, on 06 July 2017, in
Commercial Court of England. As per advice of foreign legal counsel, Nishat Chunian Power Limited - Subsidiary
Company also filed a case for anti suit injunction in Commercial Court of England against NTDC on 14 August 2017.
The District Judge, Lahore through its order dated 08 July 2017 set-aside the aforementioned orders of the Civil
Judge, Lahore dated 18 April 2017 and accepted Nishat Chunian Power Limited - Subsidiary Company’s appeals but
dismissed the Nishat Chunian Power Limited - Subsidiary Company’s revision petitions concerning the issue of
jurisdiction. Aggrieved by this decision, (i) Nishat Chunian Power Limited - Subsidiary Company filed writ petitions
before the LHC, which announced a favourable decision and suspended the proceedings of Civil Cases 2015 and
2016 till the final decision of LHC; and (ii) GOP / PPIB filed revision petitions in the LHC, which are currently pending
adjudication.
On 29 October 2017, the Arbitrator declared his Final Award whereby he ordered NTDC to pay to Nishat Chunian
Power Limited - Subsidiary Company: i) Rupees 966.166 million pursuant to Expert's determination; ii) Rupees
224.229 million being Pre award interest; iii) Rupees 9.203 million for breach of arbitration agreement; iv) Rupees
1.684 million and USD 612,311 for the Nishat Chunian Power Limited - Subsidiary Company's cost of proceedings; v)
GBP 30,157 for Nishat Chunian Power Limited - Subsidiary Company’s LCIA cost of arbitration and vi) Interest at
KIBOR + 4.5% compounded semiannually from the date of Final Award until payment of these amounts by NTDC
(“the Final Award”) that works out to Rupees 242.761 million upto 30 June 2019.
On 24 November 2017, NTDC challenged the Final Award in Commercial Court of England. On 29 November 2017,
Nishat Chunian Power Limited - Subsidiary Company filed an application before LHC for implementation of Final
Award that is also pending adjudication. During the hearing held in December 2017 in London, NTDC withdrew its
petitions dated 06 July 2017 and 24 November 2017 filed before Commercial Court of England against Nishat
Chunian Power Limited - Subsidiary Company, pertaining to Partial Final Award and Final Award respectively. On 04
May 2018, Commercial Court of England issued a favourable decision in the case of anti suit injunction, thereby
preventing NTDC from pursuing case in Pakistan Civil Courts against Partial Final Award / Final Award and taking any
steps outside England to set aside Partial Final Award / Final Award issued by the Arbitrator. Aggrieved by this
decision, NTDC has sought permission to file an appeal before the Court of Appeals, London, which was rejected by
the Court on 04 October 2018.
Based on the favourable Expert's determination and Arbitration Award, management strongly feels that under the
terms of the PPA and Implementation Agreement, the above amount of Rupees 966.166 million is likely to be
recovered by Nishat Chunian Power Limited - Subsidiary Company. Consequently, no provision for this amount has
been made in these consolidated financial statements. Further, on prudence basis, Nishat Chunian Power Limited -
Subsidiary Company has not recognised the abovementioned amounts in these consolidated financial statements
for Pre-award interest, breach of arbitration agreement, Nishat Chunian Power Limited - Subsidiary Company cost of
proceedings, Nishat Chunian Power Limited - Subsidiary Company's LCIA cost of arbitration and interest thereon on
all these amounts as per Final Award due to its uncertainty since it is pending adjudication as mentioned above.
Such amounts as per Final Award would be recognized when it attains finality and it is certain.

2019 2018
Rupees Rupees
21. LOANS AND ADVANCES
Considered good:
Employees - interest free:
- Executives 9,379,723 3,822,340
- Other employees 3,432,697 6,599,364
12,812,420 10,421,704
Current portion of long term loans to employees (Note 17) 4,561,037 3,857,638
Advances to suppliers (Note 21.1) 1,512,272,251 1,274,877,213
Advances to contractors 903,498 677,006
Letters of credit 54,965,342 329,559,315
1,585,514,548 1,619,392,876
21.1 It includes advances amounting to Rupees 0.656 million (2018: Rupees Nil) to D.G. Khan Cement Company Limited -
related party and Rupees 1.044 million (2018: Rupees 2.003 million) to Adamjee Insurance Company Limited -
associated company. These are neither past due nor impaired.
21.1.1 The maximum aggregate amount of advances to related parties at the end of any month during the year was as follows:
2019 2018
Rupees Rupees
D.G. Khan Cement Company Limited 656,083 485,614
Adamjee Insurance Company Limited 12,865,998 4,758,980

22. SHORT TERM DEPOSITS AND PREPAYMENTS
Deposits 10,138,180 9,760,036

Prepayments 29,877,162 20,737,507
40,015,342 30,497,543
23. OTHER RECEIVABLES
Considered good:
Sales tax recoverable 2,445,614,553 1,993,551,429
Advance income tax - net 829,645,679 988,852,174
Export rebate and claims 60,472,402 66,171,247
Duty drawback receivable 388,495,290 773,195,151
Receivable from employees' provident fund trust 48,269,963 20,670,671
Claim recoverable from NTDCL for pass through item -
Fair value of forward exchange contracts - 8,493,361
Insurance claim receivable (Note 23.2) 3,277,000 150,562,605
Miscellaneous 113,720,377 113,441,187
4,275,759,264 4,841,867,825
Add: Provision for the year 170,785,000 170,319,000
Less: Amount received during the year 511,451,000 113,678,573
2019 147 Nishat

Nishat (Chunian)
(Chunian) Limited
23.1.1 Under section 9.3(a) of the Power Purchase Agreement (PPA) with NTDCL, payments to Workers' Profit Participation
Fund by Nishat Chunian Power Limited - Subsidiary Company are recoverable from NTDCL as pass through item.
23.2 It includes Rupees Nil (2018: Rupees 48.519 million) receivable from Adamjee Insurance Company Limited -
associated company. It is neither past due nor impaired.
23.2.1 The maximum aggregate amount receivable from related party at the end of any month during the year was as follows:
2019 2018
Rupees Rupees
Adamjee Insurance Company Limited - associated company 61,460,801 75,430,412
24. SHORT TERM INVESTMENTS
At amortized cost
Term deposit receipts (Note 24.1) 31,160,226 31,160,226
Add: Accrued interest 82,364 1,019,465
31,242,590 32,179,691
24.1 These represent deposits under lien with the bank of the Group against bank guarantees of the same amount issued
by the bank to Sui Northern Gas Pipelines Limited against gas connections and Director, Excise and Taxation,
Karachi against disputed amount of infrastructure cess. Interest on term deposit receipts ranges from 3.12% to
12.00% (2018: 3.11% to 5.40%) per annum. The maturity period of these term deposit receipts is from six months to
one year.
2019 2018
Rupees Rupees
25. CASH AND BANK BALANCES
Cash with banks:
On saving accounts (Note 25.1)
Including US$ 14,482 (2018: US$ 14,464) 146,471,536 114,019,358
On current accounts (Note 25.2)
Including US$ 32,091 (2018: US$ 81,629) 30,756,350 131,410,269
177,227,886 245,429,627
Cash in hand 4,375,654 6,836,953
181,603,540 252,266,580
25.1 Rate of profit on saving accounts ranges from 0.15% to 10.30% (2018: 1.94% to 5.10% ) per annum.
25.2 Included in cash with banks are Rupees 12.379 million (2018: Rupees 51.471 million) with MCB Bank Limited -
associated company.
2019 2018
Rupees Rupees
26. REVENUE
Export sales (Note 26.1) 17,797,448,915 18,737,289,468
Local sales (Note 26.2 and Note 26.3) 36,718,358,959 33,255,471,346
Processing income 315,107,202 298,465,790
Export rebate 41,331,090 36,725,636
Duty drawback 116,225,012 705,495,630
54,988,471,178 53,033,447,870
26.1 Export sales includes waste sales of Rupees Nil (2018: Rupees 5.908 million).

2019 2018
Rupees Rupees
26.2 Local sales
Sales 39,131,447,085` 35,926,229,643
Less: Sales tax 2,050,964,759 2,415,140,016
Less: Advance income tax u/s 235 of the Income Tax Ordinance, 2001 7,501,375 3,193,632
Less: Discount 354,621,992 252,424,649
36,718,358,959 33,255,471,346
26.3 Local sales includes waste sales of Rupees 1,090.913 million (2018: Rupees 957.844 million).
27. COST OF SALES
Raw materials consumed 35,981,697,502 34,713,563,721
Packing materials consumed 923,523,073 929,256,432
Operations and maintenance 3,737,953 478,543
Stores, spare parts and loose tools consumed 1,483,828,824 1,255,390,452
Processing charges 396,891,327 415,688,173
Salaries, wages and other benefits (Note 27.1) 2,637,726,752 2,687,737,818
Fuel and power 907,490,916 828,474,893
Insurance 285,097,310 220,041,354
Postage and telephone 13,420,502 14,291,872
Common area maintenance charges 30,498,300 75,519,646
Lease rentals 46,644,062 111,453,682
Entertainment 8,654,043 9,653,023
Electricity consumed in-house 19,508,477 17,627,285
Amortization on intangible assets (Note 15.1) 3,993,025 4,459,866
Depreciation on operating fixed assets (Note 14.1.2) 2,224,505,816 2,320,370,231
Other factory overheads (Note 27.2) 114,126,345 118,777,519
45,579,599,276 44,214,762,780
Work-in-process
Opening stock 902,207,503 681,950,465
Closing stock (1,039,191,965) (902,207,503)
(136,984,462) (220,257,038)
Cost of goods manufactured 45,442,614,814 43,994,505,742
Finished goods and waste - opening stocks
Finished goods 2,796,817,463 1,568,868,949
Waste 106,915,432 78,504,641
2,903,732,895 1,647,373,590
48,346,347,709 45,641,879,332
Finished goods and waste - closing stocks
Finished goods (3,577,038,911) (1,788,352,893)
Waste (60,348,016) (106,915,432)
(3,637,386,927) (1,895,268,325)
44,708,960,782 43,746,611,007
27.1 Salaries, wages and other benefits include Rupees 19.345 million (2018: Rupees 21.958 million) and Rupees 57.193
million (2018: Rupees 48.295 million) in respect of accumulating compensated absences and provident funds
contributions by the Group respectively.
2019 149 Nishat
Nishat (Chunian)
(Chunian) Limited
27.2 This includes wages of contractual employees of Rupees 3.056 million (2018: Rupees 4.029 million).
2019 2018
Rupees Rupees
28. DISTRIBUTION COST
Ocean freight 118,569,960 147,469,280
Freight and octroi 190,052,486 186,120,001
Forwarding and other expenses 188,755,243 154,792,008
Export marketing expenses 140,986,208 142,214,145
Commission to selling agents 214,648,294 213,381,741
Rent, rates and taxes 21,719,135 11,965,560
Printing and stationery 23,388 4,170
Entertainment 309,397 322,387
Miscellaneous 281,572 195,551
1,006,899,746 968,232,967
(2018: Rupees 4.444 million) in respect of accumulating compensated absences and provident funds contributions
by the Group respectively. 2019 2018
Rupees Rupees
29. ADMINISTRATIVE EXPENSES
Printing and stationery 5,965,065 6,830,319
Postage and telephone 5,113,353 6,558,704
Legal and professional (Note 29.2) 72,644,331 94,814,915
Insurance 3,603,595 7,389,543
Entertainment 7,002,363 8,234,971
Amortization on intangible assets (Note 15.1) 1,520,280 2,777,190
Miscellaneous 27,808,920 27,997,317
536,380,341 483,225,873
(2018: Rupees 6.291 million) in respect of accumulating compensated absences and provident fund contribution by
the Group respectively.

29.2 Legal and professional charges include the following in respect of auditors' remuneration for:
2019 2018
Rupees Rupees
Riaz Ahmad & Company
Audit fee 2,262,500 2,192,500
Certification fees 125,000 125,000
Reimbursable expenses 184,500 184,500
3,172,800 3,027,000
A. F. Ferguson & Co.
Audit fee 1,600,000 1,565,000
Tax services 242,000 1,175,000
Certifications required by various regulations 189,000 239,000
Reimbursable expenses - 223,000
2,883,000 4,077,000
Riaz Ahmad, Saqib, Gohar & Company
Audit fee 100,000 250,000
6,155,800 7,354,000
30. OTHER EXPENSES
Workers' profit participation fund 173,467,708 106,879,304
Donations (Note 30.1) 304,178,977 5,202,000
Trade debts written off - 24,034,468
Exchange loss 22,678,000 8,635,000
Loss on disposal of operating fixed assets - 23,934,042
Miscellaneous 2,000,156 2,071,000
502,086,236 170,755,814
30.1 Donations
Following is the interest of the directors of the Group in the donees:
Directors of the Interest in
Donee
Group Companies donee
Mian Muhammad Yahya Trust Mr. Shahzad Saleem Trustee
31-Q, Gulberg II, Lahore Mrs. Farhat Saleem Trustee 3,047,250 5,082,000
Saleem Memorial Trust Hospital Mr. Shahzad Saleem Director
31-Q, Gulberg II, Lahore Mrs. Farhat Saleem Director 300,011,727 -
303,058,977 5,082,000
31. OTHER INCOME
Income from financial assets

Return on bank deposits 5,367,017 3,535,844
Mark up on loans to executives 203,000 218,000
Gain on derivative financial instruments - 1,077,000
Interest on sales tax refund bonds (Note 16) 1,704,840 -
Gain on sale of shares of Subsidiary Company 146,218,763 -
Net exchange gain 1,382,182,305 779,705,200
Income from non-financial assets
Gain on sale of operating fixed assets (Note 14.1.1) 5,802,407 -
Gain on insurance claim of stock-in-trade written off due to fire - 14,122,611
Insurance claim 78,539,000 -
Sale of scrap 81,748,782 85,918,429
Credit balances written back 2,103,084 417,222
Miscellaneous 6,446,950 3,135,909
1,710,316,148 888,130,215
2019 151 Nishat
Nishat (Chunian)
(Chunian) Limited
2019 2018
Rupees Rupees
32. FINANCE COST
Mark-up on:
- long term loans 1,038,869,419 1,139,447,406

- long term musharaka 42,145,630 37,171,056
- short term running finances 1,315,313,916 678,301,917
- export finances - Preshipment / SBP refinances 472,113,791 199,947,250
- short term finances 832,357,556 501,582,386
Interest on employees' provident fund 3,301,557 1,180,978
Interest on workers' profit participation fund (Note 9.3) 7,076,497 12,821,913
Bank charges and commission 119,653,554 141,744,267
3,830,831,920 2,712,197,173
2019 2018
Rupees Rupees
33. TAXATION
Current (Note 33.1) 522,753,349 407,024,047

Prior year adjustment 3,405,698 948,274
Deferred 9,003,052 (38,481,401)
535,162,099 369,490,920
33.1 Provision for current taxation represents minimum tax on local sales except electricity sales, final tax on export
sales, super tax on the Holding Company and tax on income from other sources at applicable rates. Provision for
current taxation relating to Nishat Chunian USA Inc. is as per applicable laws of USA. Reconciliation of tax expense
and product of accounting profit multiplied by applicable tax rate has not been presented, being impracticable.
2019 2018
34. EARNINGS PER SHARE - BASIC AND DILUTED
Profit after taxation attributable to shareholders of the

Holding Company (Rupees) 3,906,991,453 3,804,150,810
Weighted average number of ordinary shares

outstanding during the year (Number) 240,221,556 240,221,556
Basic earnings per share (Rupees) 16.26 15.84
34.1 There is no dilutive effect on basic earnings per share for the year ended 30 June 2019 and 30 June 2018 as the
Company has no potential ordinary shares as on 30 June 2019 and 30 June 2018.

2019 2018
Rupees Rupees
35. CASH GENERATED FROM OPERATIONS

Profit before taxation 6,113,628,301 5,840,555,251
Adjustments for non-cash charges and other items:
Depreciation on operating fixed assets 2,242,429,306 2,346,367,971

Amortization on intangible assets 5,513,305 7,237,056
(Gain) / loss on sale of property, plant and equipment (5,802,407) 23,934,042
Finance cost 3,830,831,920 2,712,197,173
Return on bank deposits (5,367,017) (3,535,844)
Interest on sales tax refund bonds (1,704,840) -
Gain on disposal of investment in Subsidiary Company (146,218,763) -
Credit balances written back (2,103,084) (417,222)
Working capital changes (Note 35.1) (6,345,864,230) (7,774,760,944)
5,685,103,886 3,151,577,483
35.1 Working capital changes

(Increase) / decrease in current assets:
Stores, spare parts and loose tools (282,978,189) (149,483,717)
Stock-in-trade (4,321,212,660) (2,665,006,839)
Trade debts (3,043,959,424) (5,287,572,350)
Loans and advances 24,065,028 (298,625,778)
Short term deposits and prepayments (46,917,203) 1,602,031
Other receivables 370,081,661 (410,192,379)
(7,300,920,787) (8,809,279,032)
Increase in trade and other payables 955,056,557 1,034,518,088

(6,345,864,230) (7,774,760,944)
35.2 Reconciliation of movement of liabilities to cash flows arising from financing activities:
Liabilities from financing activities
Long term Short term Unclaimed Total

financing borrowings dividend
---------------------------- Rupees ----------------------------
Balance as at 01 July 2018 15,156,572,747 25,510,180,650 53,705,334 40,720,458,731

Financing / borrowings obtained - - - -
Derecognition on disposal of investment
in Subsidiary Company (175,000,000) (74,739,920) - (249,739,920)
Repayment of financing / borrowings (4,547,217,165) - - (4,547,217,165)
Short term borrowings - net - 6,007,858,957 - 6,007,858,957
Dividend declared - - 1,321,218,558 1,321,218,558
Dividend paid - - (1,191,423,131) (1,191,423,131)
10,434,355,582 31,443,299,687 183,500,761 42,061,156,030
2019 153 Nishat

Nishat (Chunian)
(Chunian) Limited
36. REMUNERATION OF CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES
Aggregate amount charged in these consolidated financial statements for the year for remuneration including certain
benefits to the chief executive, directors and executives of the Holding Company is as follows:
Chief Executive Directors Executives

2019 2018 2019 2018 2019 2018
--------------------------------------------- Rupees ------------------------------------------
Managerial remuneration 21,280,683 7,300,000 3,600,000 - 62,100,000 55,683,472

Contribution to provident fund - - 299,880 - 5,172,930 4,638,433
House rent 8,512,273 2,920,000 1,440,000 - 24,840,000 22,273,389
Utilities 2,128,068 730,000 360,000 - 6,210,000 5,568,347
Others 4,921,024 2,326,601 - - 15,405,681 6,630,813
36,842,048 13,276,601 5,699,880 - 113,728,611 94,794,454
Number of persons 1 1 1 - 32 29
36.1 The Holding Company provides to chief executive, directors and certain executives with free use of Holding Company
maintained cars and residential telephones.
36.2 Aggregate amount charged in these consolidated financial statements for meeting fee to eight (2018: eight) directors of
the Holding Company was Rupees 440,000 (2018: Rupees 340,000).
36.3 No remuneration was paid to non-executive directors of the Holding Company.
37. TRANSACTIONS WITH RELATED PARTIES
Related parties comprise of associated undertakings, other related companies, key management personnel and post
employment benefit plan. The Group in the normal course of business carried out transactions with various related
parties. Details of transactions with related parties, other than those which have been specifically disclosed elsewhere
in these consolidated financial statements are as follows:
2019 2018
Rupees Rupees
Associated undertakings
Mark up on borrowings 55,083,835 76,009,772
Insurance premium paid 100,911,084 106,677,099
Insurance claims received 64,011,347 49,193,990
Long term loans repaid 5,031,250 -
Short term loans obtained 422,135 3,424,558,481
Short term loans repaid 410,920,537 3,543,044,395
Other related parties

Purchase of goods 29,074,940 8,969,951
Sales of goods 2,482,930,242 1,780,323,001
Dividend paid 228,305,420 113,475,835

37.1 Detail of compensation to key management personnel comprising of chief executive officer, directors and executives is
disclosed in Note 36.
37.2 Following are the related parties with whom the Company had entered into transactions or have arrangements /
agreements in place:
Transactions entered or
agreements and / or
Percentage of
Name of the related party Basis of relationship arrangements in
shareholding
place during the
financial year
Nishat Mills Limited Share holding Yes None
D.G. Khan Cement Company Limited Share holding Yes None
MCB Bank Limited Common directorship Yes None
Saleem Memorial Trust Hospital Common directorship Yes None
Adamjee Insurance Company Limited Common directorship Yes None
Adamjee Life Assurance Company Limited Common directorship Yes None
Pakgen Power Limited Common directorship No None
Mian Muhammad Yahya Trust Common directorship No None
Lalpir Solar Power (Private) Limited Common directorship No None
Nishat Energy Limited Common directorship No None
MCB Islamic Bank Limited Common directorship No None
Nishat Papers Products Company Limited Common directorship No None
Nishat (Aziz Avenue) Hotel and Properties
Limited Common directorship No None
Nishat (Gulberg) Hotel and Properties Limited Common directorship No None
Nishat (Raiwind) Hotel and properties Limited Common directorship No None
MCB Financial Services Limited Common directorship No None
Hyundai Nishat Motor (Private) Limited Common directorship No None
Nishat Hotels and Properties Limited Common directorship No None
Provident Funds Post-employment benefit plans Yes None
38 PROVIDENT FUND
Nishat (Chunain) Limited - Holding Company
As at the reporting date, the Nishat (Chunian) Limited - Employees Provident Fund is in the process of regularizing its
investments in accordance with section 218 of the Companies Act, 2017 and the rules formulated for this purpose in
terms of SRO 731(I)/2018 issued by Securities and Exchange Commission of Pakistan on 06 June 2018 which allows
transition period of three years for bringing the Employees Provident Fund Trust in conformity with the requirements of
rules.
The investments by the provident fund in collective investment schemes, listed equity and debt securities have been
made in accordance with the provisions of section 218 of the Companies Act, 2017 and the conditions specified
thereunder.
2019 2018
39. NUMBER OF EMPLOYEES
Number of employees as on 30 June 6,312 6,598
Average number of employees during the year 6,534 6,666
2019 155 Nishat

Nishat (Chunian)
(Chunian) Limited
40. SEGMENT INFORMATION
Spinning Weaving
Processing and Home Textile Power Generation Entertainment Elimination of inter-segment transactions Total - Group
2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -Rupees - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Sales
- Export 6,544,926,861 5,513,721,391 3,585,633 933,560,146 711,738,260 2,648,603,969 231,388,061 - 2,565,926,289 3,364,613,526 7,897,439,913 8,227,414,726 - - - - - - 17,955,005,017 20,687,913,758
- Local 879,715,835 1,114,240,319 5,824,260,105 5,468,024,206 9,698,848,742 5,355,057,035 2,274,512,052 2,096,736,432 325,535,506 170,013,206 2,436,372,121 569,336,445 15,286,057,152 17,071,085,467 308,164,648 501,041,002 - - 37,033,466,161 32,345,534,112
7,424,642,696 6,627,961,710 5,827,845,738 6,401,584,352 10,410,587,002 8,003,661,004 2,505,900,113 2,096,736,432 2,891,461,795 3,534,626,732 10,333,812,034 8,796,751,171 15,286,057,152 17,071,085,467 308,164,648 501,041,002 - - 54,988,471,178 53,033,447,870
Inter-segment 229,697,514 339,741,212 1,007,800,402 785,707,298 1,462,940,659 1,063,267,588 5,441,169,108 4,226,026,282 - - 6,951,733,718 5,913,278,807 5,992,707,328 2,756,339,556 - - (21,086,048,729) (15,084,360,743) - -
7,654,340,210 6,967,702,922 6,835,646,140 7,187,291,650 11,873,527,661 9,066,928,592 7,947,069,221 6,322,762,714 2,891,461,795 3,534,626,732 17,285,545,752 14,710,029,978 21,278,764,480 19,827,425,023 308,164,648 501,041,002 (21,086,048,729) (15,084,360,743) 54,988,471,178 53,033,447,870
Cost of sales (6,726,041,137) (6,099,110,592) (6,088,618,372) (6,291,325,438) (10,738,612,705) (7,936,647,248) (7,388,850,953) (6,003,241,232) (2,657,771,561) (3,356,003,996) (15,856,552,302) (13,782,136,546) (16,175,858,085) (15,006,817,828) (162,662,746) (355,688,870) 21,086,048,729 15,084,360,743 (44,708,919,132) (43,746,611,007)
Gross profit 928,299,073 868,592,330 747,027,768 895,966,212 1,134,914,956 1,130,281,344 558,218,268 319,521,482 233,690,234 178,622,736 1,428,993,450 927,893,432 5,102,906,395 4,820,607,195 145,501,902 145,352,132 - - 10,279,552,046 9,286,836,863
Distribution cost (125,641,754) (84,419,943) (56,152,715) (87,080,457) (90,686,392) (109,853,937) (100,949,630) (97,172,238) (42,261,144) (54,322,392) (591,208,111) (538,678,200) - - - - - 3,294,200 (1,006,899,746) (968,232,967)
Administrative expenses (45,023,655) (30,468,371) (30,889,291) (31,428,589) (49,913,504) (39,647,865) (41,401,081) (30,909,604) (17,331,981) (17,279,458) (132,243,616) (92,599,481) (209,294,027) (213,415,914) (10,283,186) (27,476,591) - - (536,380,341) (483,225,873)
(170,665,409) (114,888,314) (87,042,006) (118,509,046) (140,599,896) (149,501,802) (142,350,711) (128,081,842) (59,593,125) (71,601,850) (723,451,727) (631,277,681) (209,294,027) (213,415,914) (10,283,186) (27,476,591) - 3,294,200 (1,543,280,087) (1,451,458,840)
Profit before taxation and unallocated
income and expenses 757,633,664 753,704,016 659,985,762 777,457,166 994,315,060 980,779,542 415,867,557 191,439,640 174,097,109 107,020,886 705,541,723 296,615,751 4,893,612,368 4,607,191,281 135,218,716 117,875,541 - 3,294,200 8,736,271,959 7,835,378,023
Unallocated income and expenses

Other expenses (502,086,236) (170,755,814)
Other income 1,710,316,148 888,130,215
Finance cost (3,830,831,920) (2,712,197,173)
Taxation (535,162,099) (369,490,920)
Profit after taxation 5,578,507,852 5,471,064,331
40.1 Reconciliation of reportable segment assets and liabilities

Spinning Weaving Total - Group
Processing and Home Textile Power Generation Entertainment
2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Rupees - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Total assets for reportable segments 5,796,050,374 4,791,339,137 7,084,061,568 5,856,081,167 8,586,741,295 7,098,280,203 3,472,236,683 3,648,412,131 1,453,603,100 665,508,402 7,359,434,994 8,218,895,543 36,203,259,451 34,198,675,436 - - 69,955,387,465 64,477,192,019
Unallocated assets:
Long term investment 222,604,840 -
Other receivables 3,582,338,309 3,522,638,415
Cash and bank balances 17,728,377 76,444,854
Other corporate assets 732,065,406 432,893,643
Total assets as per consolidated statement of financial position 74,530,811,792 68,530,818,106
Total liabilities for reportable segments 216,855,786 113,068,028 265,045,960 138,194,257 321,267,830 167,508,190 151,202,138 181,814,877 63,298,650 101,640,336 1,151,242,772 1,025,044,749 18,162,607,295 19,445,850,398 - - 20,331,520,431 21,173,120,835
Unallocated liabilities:
Accrued mark-up 431,379,587 211,095,682
Other corporate liabilities 1,463,963,697 (107,146,724)
Total liabilities as per consolidated statement of financial position 47,070,077,075 44,472,320,749
40.2 Geographical information
The Group's revenue from external customers by geographical location is detailed below:

2019 2018
Rupees Rupees
Europe 4,655,808,998 5,168,848,681
Asia, Africa and Australia 9,927,496,475 10,996,909,477
Nishat (Chunian)
United States of America, Canada and South America 3,371,699,544 4,522,155,600
Pakistan 37,033,466,161 32,345,534,112
54,988,471,178 53,033,447,870
Limited
40.3 Almost all of the non-current assets of the Group as at reporting dates are located and operating in Pakistan.

40.4 Revenue from major customers
Nishat Chunian Power Limited - Subsidiary Company sells electricity only to NTDCL. The Holding Company earns revenue from a large mix of customers.
156
2019
2019 2018
41. PLANT CAPACITY AND ACTUAL PRODUCTION
Spinning
Number of spindles installed 222,708 222,708
Number of spindles worked 213,659 213,012
Capacity after conversion into 20/1 count (Kgs.) 79,402,488 78,969,801
Actual production of yarn after conversion into 20/1 count (Kgs.) 78,236,935 77,802,760
Under utilization of available capacity was due to normal maintenance and time lost in shifting of coarser counts to finer counts and vice
Weaving
Number of looms installed 363 363
Number of looms worked 363 363
Capacity after conversion into 50 picks - square yards 296,981,425 282,370,503
Actual production after conversion into 50 picks - square yards 25,180,349 240,664,380
Under utilization of available capacity was due to the following reasons:
- change of articles required
- higher count and cover factor
- due to normal maintenance
Power plant
Number of engines installed 17 17
Number of engines worked 17 17
Generation capacity (KWh) 343,830,000 343,830,000
Actual generation (KWh) 42,054,960 41,594,708
Dyeing
Number of thermosol dyeing machines 1 1
Number of stenters machines 4 4
Printing
Digital Printing
Actual processing of fabrics - meters 1,451,740 796,820
Stitching
The plant capacity of this division is indeterminable due to multi product plant involving varying run length of order lots.
Installed capacity [based on 8,760 hours (2018: 8,760) hours] - MWH 1,714,525 1,714,525
Actual energy delivered - MWH 599,735 1,099,666
Output produced by plant is dependent on the load demanded by NTDCL and plant availability.
NC Electric Company Limited - Subsidiary Company

Installed capacity (based on 8760 hours) (MWH) 402,960 402,960
Actual energy delivered (MWH) 288,572 280,531
Output produced by the plant is majorly dependent on the load demanded by the Holding Company.
2019 157 Nishat

Nishat (Chunian)
(Chunian) Limited
42. INTERESTS IN OTHER ENTITIES
42.1 Non-controlling interests (NCI)
Set out below is summarised financial information for Nishat Chunian Power Limited - Subsidiary
Company that has non-controlling interests that are material to the Group. The amounts disclosed for
Subsidiary Company are before inter-company eliminations.
2019 2018
Rupees Rupees
Summarised balance sheet
Current assets 18,366,882,000 15,014,916,000

Current liabilities 14,495,218,000 10,849,987,000
Current net assets 3,871,664,000 4,164,929,000
Non-current assets 11,203,838,000 11,391,166,000

Non-current liabilities 716,184,000 3,326,769,000
Non-current net assets 10,487,654,000 8,064,397,000
Net assets 14,359,318,000 12,229,326,000
Accumulated non-controlling interest 7,018,945,192 5,976,634,360
Summarised statement of comprehensive income

Revenue 15,021,084,000 16,594,018,000
Profit for the year 3,415,706,000 3,406,385,000

Other comprehensive income - -
Total comprehensive income 3,415,706,000 3,406,385,000
Profit allocated to non-controlling interest 1,671,474,749 166,913,521
Dividend to non-controlling interest 629,163,917 179,761,119

Summarised cash flows
Cash flows from operating activities 1,359,665,000 1,474,442,000
Cash flows from investing activities (890,661,000) (453,354,000)
Cash flows from financing activities (3,532,553,000) (2,651,125,000)
Net decrease in cash and cash equivalents (3,063,549,000) (1,630,037,000)

43. FINANCIAL RISK MANAGEMENT
43.1 Financial risk factors
The Group's activities expose it to a variety of financial risks: market risk (including currency risk, other
price risk and interest rate risk), credit risk and liquidity risk. The Group's overall risk management
programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse
effects on the Group's financial performance. The Group uses derivative financial instruments to hedge
Risk management is carried out by the finance departments of the Group Companies under policies
approved by the respective Board of Directors. The finance departments evaluate and hedges financial
risks. The Board of each Group Company provides principles for overall risk management, as well as
policies covering specific areas such as currency risk, other price risk, interest rate risk, credit risk,
liquidity risk, use of derivative financial instruments and non derivative financial instruments and
investment of excess liquidity.
(a) Market risk
(i) Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. Currency risk arises mainly from future commercial
transactions or receivables and payables that exist due to transactions in foreign currencies.
The Group is exposed to currency risk arising from various currency exposures, primarily with
respect to the United States Dollar (USD) and Euro. Currently, the Group's foreign exchange risk
exposure is restricted to bank balances, borrowings and the amounts receivable / payable from / to
the foreign entities. The Group uses forward exchange contracts to hedge its foreign currency risk,
when considered appropriate. The Group's exposure to currency risk was as follows:
2019 2018
Cash at banks - USD 46,573 96,093
Trade debts - USD 30,239,376 55,701,534
Trade debts - EURO 629,120 2,084,946
Trade and other payables - USD (7,718,853) (963,224)
Trade and other payables - EURO (1,172,826) (122,857)
Short term borrowings - USD (3,000,000) -
Accrued mark-up - USD (6,131) -
Net exposure - USD 19,560,965 54,834,403
Net exposure - EURO (543,706) 1,962,089
The following significant exchange rates were applied during the year:
Rupees per US Dollar

Rupees per EURO

2019 159 Nishat

Nishat (Chunian)
(Chunian) Limited
Sensitivity analysis
If the functional currency, at reporting date, had weakened / strengthened by 5% against the USD
and Euro with all other variables held constant, the impact on profit after taxation for the year would
have been Rupees 147.567 million (2018: Rupees 325.846 million) higher / lower, mainly as a result
of exchange gains / losses on translation of foreign exchange denominated financial instruments.
Currency risk sensitivity to foreign exchange movements has been calculated on a symmetric
basis. In management's opinion, the sensitivity analysis is unrepresentative of inherent currency risk
as the year end exposure does not reflect the exposure during the year.
(ii) Other price risk
Other price risk represents the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market prices (other than those arising from interest rate risk or
currency risk), whether those changes are caused by factors specific to the individual financial
instrument or its issuer, or factors affecting all similar financial instrument traded in the market. The
Group is not exposed to equity and commodity price risks.
(iii) Interest rate risk
This represents the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates.
The Group has no significant interest-bearing assets except long term loans to employees, sales
tax refund bonds, overdue trade debts of Nishat Chunian Power Limited - Subsidiary Company and
bank balances in saving and deposit accounts. The Group's interest rate risk mainly arises from
long term financing and short term borrowings. Borrowings obtained at variable rates expose the
Group to cash flow interest rate risk. Borrowings obtained at fixed rate expose the Group to fair
value interest rate risk.
At the reporting date the interest rate profile of the Group’s interest bearing financial instruments
was:
2019 2018
Rupees Rupees
Fixed rate instruments
6,555,912,980 7,462,186,990
Financial assets
Long term loans to employees 8,650,588 8,674,680

Long term investment 222,604,840 -
375,142,428 105,758,680
Net exposure (6,180,770,552) (7,356,428,310)

2019 2018
Rupees Rupees
Floating rate instruments
Financial assets
Trade debts - over due 8,197,800,000 5,433,697,000
WPPF receivable from NTDC - overdue 215,454,000 556,586,000
8,446,998,762 6,034,233,994

36,594,311,984 33,204,566,407
Net exposure (28,147,313,222) (27,170,332,413)
Fair value sensitivity analysis for fixed rate instruments

The Group does not account for any fixed rate financial assets and liabilities at fair value through
profit or loss. Therefore, a change in interest rate at the reporting date would not affect profit or loss
of the Group.
Cash flow sensitivity analysis for variable rate instruments
If interest rates at the year end date, fluctuates by 1% higher / lower with all other variables held
constant, profit after taxation for the year would have been Rupees 271.170 million (2018: Rupees
258.118 million) lower / higher, mainly as a result of higher / lower interest expense on floating rate
borrowings. This analysis is prepared assuming the amounts of liabilities outstanding at reporting
dates were outstanding for the whole year.
(b) Credit risk

Credit risk represents the risk that one party to a financial instrument will cause a financial loss for the
other party by failing to discharge an obligation. The carrying amount of financial assets represents the
maximum credit exposure. The maximum exposure to credit risk at the reporting date was as follows:
2019 2018
Rupees Rupees
Deposits 36,363,370 33,512,476
Trade debts 21,008,395,745 19,204,333,280
Loans and advances 36,337,752 32,176,569
Investments 253,847,430 32,179,691
Other receivables 503,261,377 999,427,153
Bank balances 177,227,886 245,429,627
22,015,433,560 20,547,058,796

The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (If
available) or to historical information about counterparty default rate:
Rating 2019 2018
Short Term Long term Agency Rupees Rupees
Banks
Al Baraka Bank (Pakistan) Limited A-1 A PACRA 920,411 996,143
Askari Bank Limited A1+ AA+ PACRA 310,000 26,000
Allied Bank Limited A-1+ AAA PACRA 180,899 59,588
Bank Alfalah Limited A-1+ AA+ PACRA 1,931,392 1,717,527
Bank Al-Habib Limited A-1+ AA+ PACRA 639,864 4,744,155
Dubai Islamic Bank (Pakistan) Limited A-1+ AA JCR-VIS 563,849 1,657,960
Faysal Bank Limited A-1+ AA PACRA 50,005 8,826,290
Habib Bank Limited A-1+ AAA JCR-VIS 3,634,208 54,831,814
JS Bank Limited A-1+ AA- PACRA 756,258 -
MCB Bank Limited A-1+ AAA PACRA 4,611,191 51,470,762
Meezan Bank Limited A-1+ AA+ JCR-VIS 2,004,974 15,234,827
National Bank of Pakistan A-1+ AAA PACRA 1,438,408 97,515,356
Samba Bank Limited A-1 AA JCR-VIS 34,436 1,778,095
Standard Chartered Bank (Pakistan) Limited A-1+ AAA PACRA 241,287 178,611
The Bank of Punjab A-1+ AA PACRA 48 -
United Bank Limited A-1+ AAA JCR-VIS 146,674,998 2,141,551
Industrial and Commercial Bank of China Limited P-1 A1 Moody’s 2,334 2,334
Soneri Bank Limited A1+ AA - PACRA - 4,201,875
JPMorgan Chase Bank, N.A. Not available 29,028 21,488
Habib American Bank Not available 13,204,296 25,251
177,227,886 245,429,627
Short term investments
BankIslami Pakistan Limited A1 A+ PACRA 20,687,395 21,649,175
Dubai Islamic Bank (Pakistan) Limited A-1+ AA JCR-VIS 10,555,195 10,530,516
31,242,590 32,179,691
Long term investment
FBR Refund Settlement Company Limited - sales tax refund bonds Unknown 222,604,840 -
Trade debts - NTDCL Not available 3,933,439,000 4,254,679,000

4,364,514,316 4,532,288,318
The Group's exposure to credit risk and allowance for expected credit losses related to trade debts is disclosed in Note 20.
Due to the Group's long standing business relationships with these counterparties and after giving due consideration to their strong financial
standing, management does not expect non-performance by these counter parties on their obligations to the Group. Accordingly the credit
risk is minimal.
(c) Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.
The Group manages liquidity risk by maintaining sufficient cash and the availability of funding through an adequate amount of committed credit
facilities. At 30 June 2019, the Group had Rupees 8,913 million (2018: Rupees 13,880 million) available borrowing limits from financial
institutions and Rupees 181.604 million (2018: Rupees 252.267 million) cash and bank balances. The management believes the liquidity risk
to be low. Following are the contractual maturities of financial liabilities, including interest payments. The amount disclosed in the table are
undiscounted cash flows:
Carrying Contractual More than 2
6 month or less 6-12 month 1-2 Year
Amount cash flows Years
---------------------------------Rupees-----------------------------------
Long term financing 10,434,355,582 11,450,031,171 1,233,293,170 3,863,507,695 2,843,222,583 3,510,007,723
Accrued mark-up / profit 930,241,729 930,241,729 930,241,729 - - -
46,531,281,652 54,310,529,888 23,370,714,292 24,586,585,290 2,843,222,583 3,510,007,723

Carrying Contractual 6 months or More than 2
6-12 months 1-2 Year
Amount cash flows less Years
---------------------------------Rupees-----------------------------------

Long term financing 15,156,572,747 16,356,048,087 1,788,551,868 3,922,304,884 2,299,167,183 8,346,024,152
Accrued mark-up / profit 570,404,272 570,404,272 570,404,272 - - -
44,103,948,402 46,104,803,080 20,165,215,339 15,294,396,406 2,299,167,183 8,346,024,152
The contractual cash flows relating to the above financial liabilities have been determined on the basis of interest rates / mark up rates
effective as at reporting date. The rates of interest / mark up have been disclosed in note 6 and note 11 to these consolidated financial
statements.
43.2 Financial instruments by categories
Assets as per consolidated statement of financial position

2019 2018
At amortized At amortized Loans and
At FVTPL
cost cost receivables
Rupees - - - - - - - - - - - - - - -Rupees- - - - - - - - - - - - -
Deposits 36,363,370 33,512,476 - -

Trade debts 21,008,395,745 19,204,333,280 - -
Loans and advances 36,337,752 32,176,569 - -
Investments 253,847,430 - 32,179,691 -
Other receivables 503,261,377 990,933,792 - 8,493,361
Cash and bank balances 181,603,540 252,266,580 - -
22,019,809,214 20,513,222,697 32,179,691 8,493,361
2019 2018
At amortized At amortized
At FVTPL
cost cost
- - - - - - - - -Rupees- - - - - - - - - Rupees
Liabilities as per consolidated statement of financial position
Long term financing 10,434,355,582 - 15,156,572,747
Accrued mark-up / profit 930,241,729 - 570,404,272
Short term borrowings 31,443,299,687 - 25,510,180,650
Unclaimed dividend 183,500,761 - 53,705,334
Trade and other payables 3,539,883,893 18,467,940 2,813,085,399
46,531,281,652 18,467,940 44,103,948,402
43.3 Offsetting financial assets and financial liabilities
As on reporting date, recognized financial instruments are not subject to off setting as there are no enforceable master netting arrangements
and similar agreements.
44. CAPITAL RISK MANAGEMENT

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern in order to provide returns for
shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or
adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt.
Consistent with others in the industry and the requirements of the lenders, the Group monitors the capital structure on the basis of gearing ratio.
This ratio is calculated as borrowings divided by total capital employed. Borrowings represent long term financing and short term borrowings
obtained by the Group as referred to in note 6 and note 11 respectively. Total capital employed includes 'total equity' as shown in the
consolidated statement of financial position plus 'borrowings'.
2019 2018
Borrowings Rupees 41,877,655,269 40,666,753,397
Total equity Rupees 27,460,734,717 24,058,497,357
Total capital employed Rupees 69,338,389,986 64,725,250,754
Gearing ratio Percentage 60.40 62.83

45. RECOGNIZED FAIR VALUE MEASUREMENTS - FINANCIAL INSTRUMENTS
(i) Fair value hierarchy
Judgements and estimates are made in determining the fair values of the financial instruments that are
recognised and measured at fair value in these consolidated financial statements. To provide an indication
about the reliability of the inputs used in determining fair value, the Group has classified its financial
instruments into the following three levels. An explanation of each level follows underneath the table.

At 30 June 2019
------------------------------ Rupees ----------------------------
Derivative financial liabilities - 18,467,940 - 18,467,940

Total financial liabilities - 18,467,940 - 18,467,940

At 30 June 2018
------------------------------ Rupees ----------------------------
Financial assets
Derivative financial assets - 8,493,361 - 8,493,361

Total financial assets - 8,493,361 - 8,493,361
The above table does not include fair value information for financial assets and financial liabilities not
measured at fair value if the carrying amounts are a reasonable approximation of fair value. Due to short term
nature, carrying amounts of certain financial assets and financial liabilities are considered to be the same as
their fair value. For the majority of the non-current receivables, the fair values are also not significantly different
to their carrying amounts.
There were no transfers between levels 1 and 2 for recurring fair value measurements during the year.
Further, there was no transfer in and out of level 3 measurements.
The Group’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end
of the reporting period.
Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives,
and trading and equity securities) is based on quoted market prices at the end of the reporting period. The
quoted market price used for financial assets held by the Group is the current bid price. These instruments
are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the-
counter derivatives) is determined using valuation techniques which maximise the use of observable market
data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an
instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is
included in level 3. This is the case for unlisted equity securities.
Specific valuation techniques used to value financial instruments include the use of quoted market prices or
dealer quotes for similar instruments.
46. UNUTILIZED CREDIT FACILITIES
The Group has total credit facilities amounting to Rupees 29,590 million (2018: Rupees 40,005 million) out of
which Rupees 8,913 million (2018: Rupees 13,880 million) remained unutilized at the end of the year.
47. EVENTS AFTER THE REPORTING PERIOD
The Board of Directors of the Holding Company at their meeting held on October 04, 2019 has
proposed cash dividend of Rupees 2.5 per ordinary share (2018: Rupees 4 per ordinary share) in respect
of the year ended 30 June 2019. However, this event has been considered as non-adjusting event under IAS
10 'Events after the Reporting Period' and has not been recognized in these consolidated financial statements.
Under Section 5A of the Income Tax Ordinance, 2001, a tax shall be imposed at the rate of 5% of accounting
profit before tax of the Holding Company if it does not distribute at least 20% of its after tax profit for the year
within six months of the end of the year ended 30 June 2019 through cash. The requisite cash dividend has
been proposed by the Board of Directors of the Holding Company in their meeting held on October 04, 2019
and will be distributed within the prescribed time limit. Therefore, the recognition of any income tax liability in
this respect is not considered necessary.
The members of the Holding Company in their extra ordinary general meeting held on 31 August 2019 have
approved to purchase / buy-back upto a maximum of 32 million (13.32%) issued ordinary shares of the face
value of Rupees 10 each of the Holding Company at purchase price of Rupees 32 per share.
48. DATE OF AUTHORIZATION FOR ISSUE
These consolidated financial statements were authorized for issue on October 04, 2019 by the Board
of Directors of the Holding Company.
49. CORRESPONDING FIGURES
Corresponding figures have been rearranged / regrouped wherever necessary for the purpose of comparison.
However, no significant rearrangements / regroupings have been made in these consolidated financial
statements.
50. GENERAL
Figures have been rounded off to nearest of Rupee.
____________________ _____________ ___________________________


PROXY FORM
The Company Secretary,

31-Q, Gulberg-II,
Lahore.
I / We ________________________ Of _______________________________ being a member(s)

of Nishat (Chunian) Limited, and a holder of _____________ Ordinary shares as per Share
Register Folio No. _____________ (in case of Central Depository System Account Holder A/c
No. _________ Participant I.D. No. ______) hereby appoint ______________________ of
____________________ another member of the Company as per Register Folio No.
_______________ or (failing him / her ____________________________ of
_________________________ another member of the Company) as my / our Proxy to attend and
vote for me / us and on my / our behalf at 30th Annual General Meeting of the Company, will be
held on October 28, 2019 (Monday) at 10:30 a.m at the Head Office of the Company 31-Q, Gulberg
II, Lahore and at any adjournment thereof.
As witness my hand this ____________ day of _______________ 2019 signed by the said
_______________________________________________________ in presence of
_________________________________________________________________
Witness Signature
Signature Affix Rs. 5/-

Revenue
Stamp
Notes:
1. Proxies, in order to be effective, must be received at the company's Registered Office /
Head Office not less than 48 hours before the meeting duly stamped, singed and witnessed.
2. Signature must agree with the specimen signature registered with the Company.

CONSENT FORM FOR ELECTRONIC TRANSMISSION OF ANNUAL REPORT AND NOTICE OF AGM
M/s HAMEED MAJEED ASSOCIATES (PVT) LIMITED

H.M. House, 7-Bank Square,
The Mall, Lahore
Subject: CONSENT FORM FOR ELECTRONIC TRANSMISSION OF ANNUAL REPORT AND NOTICE OF AGM
Dear Sirs,
I/we, being the shareholder(s) of NISHAT (CHUNIAN) LIMITED (“Company”), do hereby consent and
authorize the Company for electronic transmission of the Audited Annual Financial Statements of the
Company along with Noce of Annual General Meeng via the Email provided herein below and further
undertake to promptly nofy the Company of any change in my Email address.
I understand that the transmission of Annual Audited Financial Statements of the Company along with
Noce of Annual General Meeng via the Email shall meet the requirements as menoned under the
provisions of Companies Act, 2017.
Name of Shareholder(s):
Fathers / Husband Name:
CNIC:
NTN:
Fathers / Husband Name:
E-mail address:
Telephone:
Mailing Address:
Signature: (In case of corporate

Date: _____________________ shareholders, the authorized
signatory must sign)

STANDARD REQUEST FORM FOR HARD COPIES OF ANNUAL AUDITED ACCOUNTS
1. Name of Member: _________________________________________________________
2. CNIC/Passport Number: _____________________________________________________
3. Parcipant ID / Folio No/Sub A/C: _____________________________________________
8. Registered Address: ________________________________________________________
___________________________________________________________________________
I/We hereby request you to provide me/us a hard copy of the Annual Report of NISHAT (CHUNIAN)
LIMITED for the year ended June 30, ______at my above menoned registered address instead of
CD/DVD/USB. I undertake to inmate any change in the above informaon through revised Standard
Request Form.
Note:
This Standard Request Form may be sent at either of the following addresses of the Company Secretary or
Independent Share Registrar of the Company:
Company Secretary,

31-Q, Gulberg II, Lahore
Email: [email protected]
Chief Execuve,

The Mall, Lahore
In case a member prefers to receive hard copies for all the future annual audited accounts, then such preference
shall be communicated to the company in wring.

E-DIVIDEND FORM (DIVIDEND PAYMENT THROUGH ELECTRONIC MODE)
The Company Secretary/Share Registrar,
I/We, __________________________, holding CNIC No. _____________________, being the registered

shareholder of the company under folio no. __________________, state that pursuant the relevant
provisions of Secon 242 of the Companies Act, 2017 pertaining to dividend payments by listed
companies, the below menoned informaon relang to my Bank Account for receipt of current and
future cash dividends through electronic mode directly into my bank account are true and correct and I
will inmate the changes, if any in the above-menoned informaon to the company and the concerned
Share Registrar as soon as these occur through revised E-Dividend Form.
Title of Bank Account
Bank Account Number

IBAN Number
Bank’s Name
Branch Name and Address
Cell Number of Shareholder
Landline number of Shareholder

Email of Shareholder
In case of CDC shareholding, I hereby also undertake that I shall update the above informaon of my
bank account in the Central Depository System through respecve parcipant
Date: ____________ Member’s Signature
Note:
Company Secretary Chief Execuve,
NISHAT (CHUNIAN) LIMITED M/s HAMEED MAJEED ASSOCIATES (PVT) LIMITED

31-Q, Gulberg II, Lahore H.M. House, 7-Bank Square,
Email: [email protected] The Mall, Lahore

FORM FOR VIDEO CONFERENCE FACILITY
The Company Secretary/Share Registrar,
I/we,__________________________, of _____________________, being the registered shareholder(s)

of the company under Folio No(s). __________________/ CDC Parcipant ID No.___ and Sub Account
No.___ CDC Investor Account ID No., and holder of ___________ Ordinary Shares, hereby request for
video conference facility at _________________ for the Annual General Meeng of the Company to be
held on 28th October, 2019.
Date: _________________ Member’s Signature
Note:
Company Secretary,

31-Q, Gulberg II, Lahore
Email: [email protected]
Chief Execuve,

The Mall, Lahore
INVESTORS’ EDUCATION
In pursuance of SRO 924(1)/2015 dated September 9th, 2015 issued by the Securities and Exchange Commission of
Pakistan (SECP), the following informational message has been reproduced to educate investors:

CrossMedia | 0333 450 1684

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ANNUAL REPORT 2019

Nishat Chunian Limited

2015 Diversified into Cinema Business

2014 46 MW Coal Based Power Plant

2013 Established a subsidiary company in

2013 2 Spinning Mills acquired & a new spin-

2010 IPP commercial operations

2006 Diversified into Home Textiles

2005 Acquisition of 2 spinning Mills & 5th

2000 2nd Spinning mill started production

1998 Diversified into Weaving

1991 1st Spinning Mill Setup

Nishat (Chunian) Limited 1 2019

Nishat (Chunian) Limited – Financial Statements

Statement of Financial Position 34

Consolidated Financial Statements

Independent Auditor’s Report 94

Nishat (Chunian) Limited 3 2019

Board of Directors: Bankers to the Company:

Dyeing & Printing Share Registrar:

2019 4 Nishat (Chunian) Limited

By order of the Board

1. Closure of Share Transfer Books

For attending AGM:

For entitlement of Final Cash Dividend:

2. Participation in the Annual General Meeting

A. For Attending the Meeting:

B. For Appointing Proxies:

3. CNIC / NTN Number on Dividend Warrant (Mandatory)

2019 6 Nishat (Chunian) Limited

Compa- Folio/CDs Total Principal Shareholder Joint Shareholder

6. Payment of Cash Dividend Electronically

Nishat (Chunian) Limited 7 2019

7. Circulation of Annual reports through Digital Storage

8. Video Conference Facility

2019 8 Nishat (Chunian) Limited

As required by Regulation 4(1) of the Regulations 2012 (the “Regulations”), it is declared

Audited Financial Statements of Nishat Chunian Power Limited

As required by Regulation 5 of the Regulations, the latest financial statements of the

Nishat (Chunian) Limited 9 2019

As required by the Companies (Investment in Associated Companies or Associated

Ref. Requirement Information

2019 10 Nishat (Chunian) Limited

Profit & loss:

Gross Profit 5,075,633

Nishat (Chunian) Limited 11 2019

2019 12 Nishat (Chunian) Limited

Mrs. Farhat Saleem

2019 13 Nishat (Chunian) Limited

Nishat (Chunian) Limited 14 2019

• 2 Embroidery machines 27.2

Segment Wise Revenue

2019 17 Nishat (Chunian) Limited

Nishat (Chunian) Limited 18 2019

2019 19 Nishat (Chunian) Limited

Corporate Social Responsibility

Internal Financial Controls

2019 21 Nishat (Chunian) Limited

Statement of Value Addition

To Government & Society

Employee remuneration 2,616

Retained for reinvestment and future growth

Break up value Net Debt Equity Rao (% age)

_ _________

______________ _ _____________________