Rafhan Maize Products Company Limited: performance and outlook

Rafhan Maize Products Company Limited (PSX: RMPL) started its operations in Pakistan as a corn refining industry in 1953. Over the course of years, the company has grown into one of the biggest agro based industries of Pakistan.

RMPL produces a variety of food ingredients and industrial products using maize as a basic raw material. RMPL turned into a public limited company in 1985.

Pattern of Shareholding

As of December 31, 2025, the company has a total of 9.236 million shares outstanding which are held by 1421 shareholders. Ingredion Incorporated Chicago, USA (parent company) holds 71.04 percent shares of RMPL followed by local general public with a stake of 19.19 percent in the company.

Directors, CEO, their spouse and minor children hold 7.04 percent shares of RMPL while Insurance companies account for 1.54 percent shares. 1 percent of the company’s shares are held by Banks, DFIs and NBFIs.

The remaining shares are held by other categories of shareholders.

Financial Performance (2021-25)

RMPL’s topline posted year-on-year growth over the period under consideration. The bottomline also followed the similar trajectory except for a nosedive in 2022 and 2025. Margins attained their optimum level in 2020.

In the subsequent two years, the margins deteriorated followed by an uptick in 2023. In 2024, gross and operating margins fell while net margin posted a skimpy growth. This was followed by a decline in all the margins in 2025. The detailed performance review of the period under consideration is given below.

In 2021, RMPL’s topline grew by 18.78 percent year-on-year to clock in at Rs.42,609.63 million. The topline growth was supported by both price and volumetric increase. However, high cost of sales particularly because of elevated fuel and power cost as well as high prices of specific varieties of corn put GP margin under pressure which clocked in at 24.22 percent in 2021.

In absolute terms, gross profit inched up by 5.48 percent in 2021. Distribution expense inched up by 4.92 percent in 2021 due to elevated commission expense incurred during the year. Administrative expense mounted by 21.94 percent in 2021 due to higher payroll expense which was the result of inflationary pressure. RMPL streamlined in workforce from 1122 employees in 2020 to 1064 employees in 2021.

Other income posted 18 percent improvement over the last year due to increased mark-up income on bank deposits and staff loan as well as gain recorded on the sale of scrap in 2021. However, other income was counterbalanced by 10.54 percent higher other expense recorded in 2021 on account of profit related provisioning. Operating profit ticked up by 5.49 percent in 2021 while OP margin fell to 21 percent.

Finance cost plunged by 0.78 percent year-on-year in 2021. Monetary easing and the absence of foreign exchange loss played its role in keeping the finance cost in check.

RMPL’s net profit posted a marginal 2.68 percent year-on-year growth to clock in at Rs.6257.32 million in 2021. This translated into EPS of Rs.677.46 and NP margin of 14.70 percent in 2021 as against EPS of Rs.659.80 and NP margin of 17 percent registered in 2020.

In 2022, RMPL boasted 37.89 percent year-on-year growth in its net sales which clocked in at Rs.58,755.77 million. This was the result of better sales mix and prices which compensated for volume loss. Growth in export revenue was majorly driven by Pak Rupee devaluation which resulted in higher exchange gain for the company.

In the domestic market, while textile as well as paper and corrugation sectors continued to grapple owing to floods, weakening exports, high energy cost, recession etc, food sector provided much needed growth momentum to RMPL. 45.31 higher cost of sales incurred in 2022 didn’t let RMPL sustain its GP margin which dropped to five-year low level of 20.14 percent.

In absolute terms, gross profit picked up by 14.68 percent in 2022. Distribution expense escalated by 23.91 percent in 2022 due to higher commission expense and increased salaries of sales force.

Administrative expense surged by 34.11 percent in 2022 due to increase in IT, data communication and networking charges as well as higher payroll expense.

RMPL expanded its workforce to 1075 employees in 2022. Other income grew by 12.56 percent in 2022 due to higher profit recognized on the sale of scrap and robust foreign exchange gain. In line with the previous year, other income was offset by 10.58 percent higher other expense which encompassed provisioning done for WWF and WPPF.

Operating profit grew by 12.69 percent in 2022, however, OP margin fell down to its lowest level of 17.24 percent. Finance cost multiplied by a massive 347.76 percent in 2022 owing to higher discount rate as well as increased short-term running finances obtained during the year.

RMPL bottomline tapered off by 1.25 percent year-on-year to clock in at Rs.6179.39 million. This translated into NP margin of 10.52 percent and EPS of Rs.669.02.

In 2023, RMPL’s topline grew by 11.42 percent to clock in at Rs.65,466.70 million. While textile sector demand continued to struggle owing to higher energy cost and global demand destruction, paper & corrugation segment and food segment showed resilience during the year.

The company also explored new export markets resulting in improvement in export sales. Upward price revision to combat inflationary pressure, elevated energy cost and higher global commodity prices also supported topline growth in 2023. Cost of sales surged by 9.70 percent in 2023 due to the reasons stated above. Gross profit strengthened by 18.24 percent in 2023 with GP margin picking up to 21.37 percent.

Distribution expense posted 19.15 percent growth in 2023 on account of higher commission expense and increased salaries of sales force. Administrative expense spiraled by 37.30 percent in 2023 due to higher IT, networking and data communication charges and increased payroll expense as the company further enhanced its workforce to 1097 employees.

Other income posted a phenomenal growth of 122.97 percent in 2023 particularly on the back of hefty mark-up income, dividend income and profit on sale of scrap. Unlike previous year, in 2023, other income outnumbered other expense. Other expense grew by 19.49 percent in 2023 due to exchange loss and profit related provisioning.

RMPL posted 23.45 percent higher operating profit in 2023 with OP margin climbing up to 19.10 percent. 143.61 percent higher finance cost incurred in 2023 was the consequence of monetary tightening and increased external financing.

RMPL’s net profit progressed by 11.87 percent to clock in at Rs.6912.78 million in 2023. This translated into EPS of Rs.748.43 and NP margin of 10.56 percent in 2023.

In 2024, RMPL’s topline posted a marginal year-on-year growth of 6.81 percent to clock in at Rs.69,922.60 million. Sales growth was mainly attributable to price increase and increase in export sales on the back of tapping new markets.

Overall volumes remained subdued due to lackluster performance of textile sector which is the major customer of RMPL. Cost of sales surged by 7.42 percent due to high inflation and Pak Rupee depreciation as well as elevated energy cost. Gross profit picked up by 4.56 percent in 2024, however, GP margin slightly inched down to 20.92 percent.

Distribution and administrative expenses grew by 13.56 percent and 10.46 percent respectively during the year. The main growth propellers were enhanced payroll expense, communication expense as well as commission expense. RMPL streamlined its workforce to 1057 employees in 2024.

Other income ticked down by 5.88 percent in 2024 due to considerable decline in mark-up on bank deposits on account of the onset of monetary easing during the year. The absence of foreign exchange loss during the year pushed down other expense by 2.16 percent in 2024. Operating profit posted a marginal growth of 2.53 percent in 2024 with OP margin sinking to 18.33 percent.

Finance cost escalated by 54.14 percent in 2024 due to increased short-term and long-term borrowing and higher discount rate for most part of the year. Net profit picked up by 8.13 percent to clock in at Rs.7475.11 million in 2024. This translated into EPS of Rs.809.31 and NP margin of 10.69 percent in 2024.

In 2025, RMPL posted 4.92 percent year-on-year growth in its topline which clocked in at Rs.73,362.63 million. The growth was mainly backed by superior local sales in 2025 as the company diversified its application areas to generate sales.

Export sales remained steady for the first three quarters of 2025, however, fell in the final quarter due to Pak-Afghan border tensions. Food ingredient business faced challenges due to high price of sugar and tough competition from informal sector.

Dextrose segment also suffered from cheaper imports. Conversely, processed food, pharmaceutical, poultry & livestock sectors showed progress over the year. Cost of sales mounted by 7.70 percent in 2025 due to higher energy cost and elevated sugar and corn prices.

The company couldn’t raise its prices due to stiff competition from regional and local competitors. This resulted in 5.60 percent diminution in gross profit in 2025 with GP margin hitting its lowest level of 18.83 percent. Increased focus on cross border sales culminated into 28 percent higher distribution expense in 2025.

Administrative expense also surged by 14.26 percent in 2025 due to higher payroll expense as well as IT, network and data communication charges. Workforce was streamlined from 1057 employees in 2024 to 1029 employees in 2025. Superior gain recognized on the sale of investment and robust mark-up income in 2025 was offset by no foreign exchange gain and thinner dividend income, resulting in 2.49 percent downtick in other income in 2025.

Other expense also went down by 2.84 percent in 2025 due to lower profit related provisioning done during the year. Operating profit weakened by 10.18 percent in 2025 with OP margin falling down to 15.70 percent. Finance cost ticked up by 5 percent in 2025 due to higher working capital related financing obtained during the period. Net profit dwindled by 12.58 percent to clock in at Rs.6534.84 million in 2025. This translated into EPS of Rs.707.51 and NP margin of 8.91 percent in 2025.

Recent Performance (1QCY26)

During the first quarter of CY26, RMPL’s remained largely stable (0.06 percent downtick to be exact) to clock in at Rs.19043.84 million. Domestic sales progressed during the period backed by food ingredient, processed foods, pharmaceutical, nutraceutical and dextrose segments. Conversely, export sales ticked down due to geopolitical tensions which dampened the demand across segments.

Discontinuation of trade with Afghanistan due to border tensions and price war among regional peers also affected export sales in 1QCY26. Cost discipline and operational efficiency resulted in 6.83 percent improvement in RMPL’s gross profit in 1QCY26 with GP margin clocking in at 21.86 percent versus GP margin of 20.45 percent recorded in 1QCY25.

Operating expense ticked up by 5.55 percent in 1QCY26 due to inflationary pressure, product diversification and improved geographical mix. Monetary easing and a decline in short-term investment appear to be the cause of 40.68 percent diminution in other income in 1QCY26. Other income was almost offset by 2.40 percent uptick recorded in other expense during the period which is likely due to increased provisioning done for WWF and WPPF.

RMPL recorded 1 percent uptick in its operating profit in 1QCY26 with OP margin staying intact at 18 percent. Finance cost plunged by 40 percent in 1QCY26 due to monetary easing and settlement of a considerable portion of outstanding liabilities.

RMPL registered 3.98 percent growth in its net profit which clocked in at Rs.2032.881 million. This translated into EPS of Rs.220.09 and NP margin of 10.67 percent in 1QCY26 versus EPS of Rs.211.67 and NP margin of 10.26 percent recorded in 1QCY25.

Future Outlook

Improvement in local macroeconomic indicator provided some respite and contributed to improved local demand; however, rising geopolitical tensions, global recession, increased competition and heightened energy tariff continue to suppress the company’s financial performance.

The company aims to combat these challenges by controlling non-productive cost, achieving product mix optimization and enhancing its export sales.

Recently, a public announcement has been made by Nishat Hotels and Properties Limited, D. G. Khan Cement Co. Limited, Nishat Mills Limited, Nishat Power Limited, Nishat Chunian Power Limited, Lalpir Power Limited, Pakgen Power Limited, Mrs. Naz Mansha, Mr. Raza Mansha, Mr. Umer Mansha and Mr. Hassan Mansha for the acquisition of 298,759 ordinary shares and management control of RMPL. This will likely instill a new life to the financial performance of RMPL by improving its export channels, facilitating better procurement, initiate R&D through capital backing and making more aggressive expansions across market segments.