Sana Industries Limited (PSX: SNAI) was incorporated as a public limited company in 1985.
The principal activity of the company is the manufacturing and sale of man-made blended yarn. The company is an entity of Sanaullah Group of Companies.
Pattern of Shareholding
As of June 30, 2025, SNAI has a total of 19.965 million shares outstanding which are held by 619 shareholders. Directors, their spouse and minor children have the majority stake of 64.81 percent in the company followed by local general public holding 29.92 percent shares of SNAI.
Modarabas and Mutual funds account for 3.35 percent of the company’s shares. The remaining shares are held by other categories of shareholders.
Historical Performance (2021-25)
Except for a year-on-year decline in 2025, SNAI’s topline rode an upward trajectory over the period under consideration. The company posted net losses in 2023 and 2024. SNAI’s margins rebounded in 2021. In 2022, while gross margin took a plunge, operating and net margins continued to tick up. SNAI’s margins touched their lowest level in 2023.
Conversely, in 2024 and 2025, the margins considerably picked up. The detailed performance review of the period under consideration is given below.
SNAI counterbalanced the sluggish sales made in the previous year by achieving 50 percent superior net sales to the tune of Rs. 2129 million in 2021. With the resumption of operational activities post COVID-19, the company’s production volume grew by 28 percent. This culminated into capacity utilization of 94 percent.
The stimulus packages for trade and industry offered by the government in 2021 along with monetary easing instilled life in the stagnant local economy.
Global economy also started to regain its lost momentum, resulting in the revival in demand and prices of yarn. This enabled SNAI to drive up its gross profit by 192.61 percent in 2021 with GP margin reaching its optimum level of 12.07 percent versus GP margin of 6.19 percent recorded in 2020.
Selling and distribution expense diminished by 23 percent in 2021 due to significantly lower payroll expense of sales & marketing staff incurred during the year. Conversely, administrative expense multiplied by 17.52 percent in 2021 due to higher payroll expense as the company expanded its workforce to 215 employees from 129 employees in 2020.
Higher rental income, operating and maintenance charges, gain on sale of operating fixed assets and amortization of deferred government grant were the main contributors behind 57.7 percent higher other income earned by SNAI in 2021.
Increased profit related provisioning pushed up other expense by manifold in 2021. Operating profit recorded 527.41 percent rise in 2021 with OP margin clocking in at 9.28 percent versus 2.22 percent in 2020.
Lower discount rate during the year enabled SNAI to cut down its finance cost by 19.15 percent in 2021. This resulted in net profit of Rs.94.78 million with EPS of Rs.9.10 and NP margin of 4.45 percent in 2021 as against net loss of Rs.31.46 million and loss per share of Rs.3.59 recorded in 2020.
In 2022, SNAI’s topline registered a healthy 23.56 percent year-on-year rise to clock in at Rs.2630.60 million. This was on account of an augmentation in yarn prices coupled with the rise in sales volume. During the year, the company added 2400 spindles to meet the rising demand. The production volume grew by 3 percent year-on-year in 2023 and capacity utilization stood at 89 percent.
Cost of sales hiked by 24.20 percent in 2022 on account of hike in global commodity prices particularly POL products, Pak Rupee depreciation, spike in energy tariff and high indigenous inflation. This resulted in a downtick in SNAI’s GP margin which stood at 11.62 percent in 2022 despite 18.95 percent growth in the company’s gross profit in absolute terms. Selling and administrative expenses were largely contained and grew marginally by 1 percent and 8.16 percent respectively in 2022.
Other income enlarged by 79.92 percent in 2022 due to higher gain recognized on the sale of fixed assets as well as gain recognized on the re-measurement of GIDC. This translated into 33.96 percent higher operating profit posted by the company in 2022 with OP margin climbing up to 10.06 percent.
Finance cost soared by 50.30 percent in 2022 on account of higher discount rate as well as higher outstanding borrowings during the year. SNAI registered 35.36 percent rise in its net profit in 2022 which clocked in at Rs.128.29 million with EPS of Rs.6.43 and NP margin of 4.88 percent.
SNAI’s topline posted a paltry 9.69 percent year-on-year growth to clock in at Rs.2885.60 million in 2023. This was merely the result of increase in yarn price and depreciation in the value of local currency. Production volume slid by 6 percent in 2023 with capacity utilization clocking in at 79 percent.
Inflationary pressure, supply chain disruptions due to dwindling foreign exchange reserves, global commodity super cycle and Pak Rupee squeezed SNAI’s gross profit by 58.62 percent in 2023 with GP margin marching down to 4.38 percent. Selling and administrative expenses enlarged by 66 percent and 37.80 percent respectively in 2023.
Besides unprecedented level of inflation, the other main factors behind higher operating expenses were payroll expense, directors’ remuneration and packing and forwarding charges incurred during the year.
Other income receded by 69.10 percent in 2023 due to lower rental income and lower gain on sale of operating fixed assets recognized during the year. SNAI didn’t book any profit related provisioning during the year, resulting in 96.63 percent lower other expense incurred during the year.
Operating profit tumbled by 93.67 percent in 2023. Finance cost escalated by 120.56 percent in 2023 which was the consequence of higher discount rate and considerably higher borrowings particularly working capital related borrowings obtained during the year. This resulted in net loss of Rs.105.21 million with loss per share of Rs.5.27 in 2023.
In 2024, SNAI’s topline registered year-on-year growth of 31.83 percent to clock in at Rs.3804.19 million. During the year, the company increased its production capacity by 20 percent and utilized 85 percent capacity.
Improved yarn prices and higher sales volume due to higher production capacity and integration of a new principal Engro Friesland Campina into its distribution operations resulted in 137.48 percent rise in gross profit in 2024.
GP margin climbed up to 7.90 percent during the year. Selling & administrative expense mounted by 75.36 percent due to higher sales volume as the company expanded its market reach and introduced new product offerings during the year.
Administrative expense inched up by 4.97 percent in 2024 due to higher payroll expense as well as directors’ remuneration.
SNAI also expanded its workforce from 250 employees in 2023 to 254 employees in 2024. Other income slid by 66.14 percent in 2024 as the company recorded Rs.19.672 million as income related to receivables from Lasbela Industrial Estate Development Authority (LIEDA) in the previous year. This receivable pertained to standard electricity rates billed to the company by the LIEDA despite the fact that it operates under zero-rated status.
While the company paid the bills according to standard rates, it recorded the difference between subsidized and standard rates as receivable from LIEDA in 2023.
Other expense multiplied by 63.91 percent in 2024 due to higher provision booked against slow moving stores & spares. Operating profit strengthened by 812.49 percent in 2024 with OP margin jumping up to 4 percent.
Higher discount rate resulted in 24.69 percent escalation in finance cost in 2024. This was despite the fact that the company discharged some portion of its external liabilities during the year and acquired interest free loan of Rs.19.5 million from company directors to meet its working capital requirement.
Regardless, SNAI posted net loss of Rs.75.49 million in 2024, down 28.25 percent year-on-year. This translated into loss per share of Rs.3.78
In 2025, the company optimized its portfolio and discontinued some of its projects which were contributing to loss making.
Another reason for a thinner topline in 2025 was the lack of domestic competitiveness due to removal of sales tax exemptions on local inputs while imported yarn continued to be duty and tax free. This resulted in 36.48 percent year-on-year slump in SNAI’s topline which clocked in at Rs.2416.29 million in 2025. Production volume was recorded at 4.73 million kilograms, down 34 percent year-on-year. This translated into capacity utilization of 56 percent in 2025 versus 85 percent in the previous year.
As the company suspended its loss making projects, it was able to record a stronger GP margin of 8.42 percent in 2025. Selling & distribution expense nosedived by 14.29 percent in 2025 due to lower sales volume which resulted in lower packing & forwarding expense.
Administrative expense also shrank by 9.28 percent in 2025 on account of thinner depreciation expense, utility expense and legal & professional charges incurred during the year.
Workforce was also streamlined from 254 employees in 2024 to 241 employees in 2025. SNAI’s other income multiplied by 4723 percent to clock in at Rs.327.35 million in 2025. This was the result of robust gain recognized on the sale of investment property and fixed assets as well as greater rental income recorded in 2025.
No provisioning was done for ECL and slow-moving store items, resulting in no other expense in 2025. Operating profit rebounded by 157.42 percent in 2025 with OP margin climbing up to its optimum level of 16.29 percent. Finance cost slid by 22.80 percent in 2025 due to lower discount rate and relatively lesser outstanding borrowings.
While delays in sales tax refunds continued to tighten the liquidity position, the company replaced a huge portion of its external loans with interest-free loans from the company’s directors. SNAI posted net profit of Rs.111.42 million in 2025. This translated into EPS of Rs.5.58 and NP margin of 4.61 percent in 2025.
Recent Performance (9MFY26)
During the nine-month period of the ongoing fiscal year, SNAI registered 30.41 percent year-on-year dilution in its net sales which clocked in at Rs.1258.105 million. This was due to increased price competition from imported yarn particularly from China where lower energy cost allows the textile industries to offer lower prices.
Elevated gas tariff and higher energy cost due to the company’s increased reliance on captive power generation during the earlier part of the period drastically increased the cost of sales.
Eventually, the company switched to a mix of renewable energy sources and gird electricity. This enabled SNAI to cut down its cost of sales by 33.75 percent in 9MFY26. Gross profit improved by 19 percent in 9MFY26 with GP margin clocking in at 10.83 percent versus GP margin of 6.33 percent recorded in 9MFY26.
Distribution expense surged by 8.39 percent in 9MFY26 as access to Northern market is getting expensive. Administrative expense tumbled by 9.93 percent in 9MFY26 seemingly because the company rationalized its workforce due to curtailed operations which was in line with thinner demand and to align the production level with cost effective energy availability.
Operating profit strengthened by 65 percent in 9MFY26 with OP margin clocking in at 5.19 percent versus OP margin of 2.19 percent registered in 9MFY25. Finance cost tapered off by 41.90 percent in 9MFY26 due to monetary easing and reduced borrowings. SNAI’s net loss tumbled by 49.19 percent to clock in at Rs.60.97 million in 9MFY26. This translated into loss per share of Rs.3.05 in 9MFY26 versus loss per share of Rs.6.01 recorded in 9MFY25.
Future Outlook
With increased competition from the imported products, the company is increasingly optimizing its energy mix to reduce its energy cost and offer competitive prices. For this, the company is planning to undertake CAPEX and increase its solar power capacity.
In January 2026, the company commissioned its 1.1 MW solar power plant with the plan to enhance it further. SNAI is also focusing on South market which is closer to its production unit. This will safe its logistics cost.