Annual Report

In the dynamic landscape of the steel industry, Mughal Steel has
continued to set new benchmarks by embracing a philosophy that

is not just about outshining others, but about outdoing ourselves.
This year’s annual report cover story encapsulates our journey,
highlighting how our unwavering commitment to diversification,
innovation, quality, and sustainability has enabled us to not only
compete but thrive, while constantly raising our own standards.
ABOUT THIS
REPORT
We are pleased to present our annual report for the year ended June 30, 2023.
With this report we aim to provide all our stakeholders with a transparent and
balanced appraisal of the material issues that faced our business during the
year under review. The report should be read in conjunction with the full financial
statements.
Scope and Boundary of Forward Looking

This Report Statements
This annual report covers the year from July 01, 2022 to June This annual report contains certain “forward-looking
30, 2023. The previous annual report covered the 2021-2022 statements” – that is, statements related to future, not
financial year. This annual report provides an account of past, events. In this context, forward-looking statements
the Company’s operational, financial, economic, social and often address our expected future business and financial
environmental performance, as well as governance, during performance and financial condition, and often contain
the period under review etc. words such as “expect,” “anticipate,” “intend,” “plan,”
“believe,” “seek,” “see,” “will,” “would,” or “target.”
Our Two Reports The statements include known and unknown risks and
opportunities, other uncertainties and important factors
that could turn out to be materially different following the
Annual Report publication of actual results.
This printed annual report also available online at www.
mughalsteel.com is intended to provide readers with an These forward-looking statements speak only as of the date
overview of our operations during the year. It includes of this document. The Company undertakes no obligation
messages from leadership, financial and operational to update publicly or release any revisions to these forward-
reviews, corporate governance and risk management looking statements, to reflect events or circumstances after
reports, summarized financial statements and information for the date of this document, or to reflect the occurrence of
shareholders. anticipated events.
Annual Financial Statements

Feedback
The full financial statements included in this report and
also available on our above mentioned website provide Please provide us with your feedback. We value feedback
a comprehensive insight into the financial position and from our stakeholders and use it to ensure that we are
performance of the Company for the year under review. reporting on the issues that are relevant to them. Please take
the time to give us your feedback on this report. Your emails
are welcomed at [email protected].
MUGHAL IRON & STEEL INDUSTRIES LIMITED

2023 ANNUAL
REPORT 01
KEY FIGURES
Profit Before Taxation

(2022: 6,202)
4,346 EBITDA
(2022: 9,272)
9,226
Sales Rs. in Millions
(2022: 66,153)
67,390
Rs. in Millions
Rs. in Millions
Earnings per Share Profit for the Year

(2022: 16.12) (2022:5,411)
10.37 3,480
Rupees Rs. in Millions
COMPETING
02 Own’s YESTERDAY
Shareholders’ Equity
(2022: 20,847)
25,372 Rs. in Millions

Capital
Expenditure
(2022: 1,696)
1,738
Rs. in Millions
Export Sales
(2022: 13,763)
15,041
Rs. in Millions
Total Assets
(2022: 53,086) Break-up Value
59,832 per Share

(2022: 62.11)
Rs. in Millions
75.60
Rupees
Current Ratio
(2022: 1.45)
1.50
Times

2023 ANNUAL
REPORT 03
01
08
Organizational
Overview
Vision, Mission & Overall Corporate Strategy
10 Code of Conduct, Culture, Values & Ethical Principles
14 Company Profile
16 Key Strengths
18 Company Information
20 Entity Rating
21 Share Price Information
22 Organization Chart & Operating Structure of the Company
24 Position of the Organization In Value Chain
26 Awards & Accolades
27 History of Major Events
28 Corporate Governance
34 Board Profile
CONTENTS
02 Directors’
Report
40 Chairman’s Letter to the Shareholders
42 Chief Executive Officer’s Remarks
44 Directors’ Report to the Shareholders
57 ‫شئیر ہولڈرز کے لئے ڈائریکٹرز کی رپورٹ‬
58 ‫چیف ایگزیکٹو آفیرسکا تبرصہ‬
59 ‫شئیر ہولڈرز کیلئے چیرئمین کا خط‬
COMPETING
04 72
Financial
Statements
Shariah Review Report
73 Independent Assurance Report on Compliance
With the Shariah Governance Regulations, 2023
75 Statement of Compliance With Sukuk and
Islamic Commercial Paper (ICP) Features and
Shariah Requirements
76 Independent Auditors’ Review Report To The
Members
77 Statement of Compliance With Listed Companies
(Code Of Corporate Governance) Regulations,
2019
79 Independent Auditors’ Report To The Members
82 Statement of Financial Position
83 Statement Of Profit Or Loss & Other
Comprehensive Income
84 Statement of Changes In Equity
85 Statement of Cash Flows
86 Notes To And Forming Part of The Financial
Statements
03
62
Financial
Highlights
Horizontal Analysis
63
05
Vertical Analysis
64 Summary of Statement of Cash Flows
65 Financial Ratios Other
66
68
Graphical Analysis
Distribution of Wealth
Information
69 Results reported in Interim Financial 144 Pattern of Shareholding
Statements and Final Accounts 146 Trading in Shares of the Company
147 Notice of Annual General Meeting
150 Statement of Material Facts as Required Under
Section 134(3) of the Companies Act, 2017
151 Form of Proxy
153 ‫پراکسی فارم‬

2023 ANNUAL
REPORT 05
01
ORGANIZATIONAL
OVERVIEW
• Vision, Mission & Overall Corporate Strategy
• Code of Conduct, Culture, Values & Ethical Principles
• Company Profile
• Key Strengths
• Company Information
• Entity Rating
• Share Price Information
• Organization Chart & Operating Structure of the Company
• Position of the Organization In Value Chain
• Awards & Accolades
• History of Major Events
• Corporate Governance
• Board Profile
VISION,
MISSION &
OVERALL
CORPORATE
STRATEGY
COMPETING
VISION
STATEMENT
To be a leading corporate entity in the steel sector which is recognized both
at the industry level and national level, endeavoring to achieve excellence in
core business while striving to explore multiple growth opportunities, remaining
ethically and socially responsible and strengthening the growing base of satisfied
customers by providing quality and durable steel products.
MISSION
STATEMENT
To meet the expectations of our customers in providing them with high quality,
reliable and durable steel products, through product research, business process
and information system improvement and up-gradation of technology. To meet
the expectations of our employees by providing opportunities for professional
growth and personal welfare. To meet the expectations of our shareholders by
enhancing profitability and maximizing returns through achieving excellence in
core business and exploring growth opportunities through diversification.
OVERALL CORPORATE
STRATEGY
Maintaining our competitive position in the core business by employing
professional and technical excellence, exploring new growth opportunities
through diversification and creating value for our stakeholders.

2023 ANNUAL
REPORT 09
CODE OF CONDUCT, CULTURE,
VALUES & ETHICAL PRINCIPLES
The Basic Principles of to use their position at the Company to obtain any improper
personal benefit for themselves, their family member(s) or
our Code of Conduct any other individual or group.
and Ethics Fair and Ethical Competition

We believe the best way to build and Every Director and employee must deal fairly with customers,
to maintain trust is to conduct every suppliers, competitors and each other. No one at the
element of our business according to Company may seek competitive advantage through illegal
or unethical business practices. Taking unfair advantage
the highest standards of integrity. Our
of anyone through manipulation, concealment, abuse of
ability to do so rests on the behavior of privileged information, misrepresentation of material facts, or
those who work here, from employees any unfair dealing practice is a violation of this Code.
to our Chief Executive Officer to our
Directors. To that end, we select our Protecting Confidential Information
people based not just on their skills, Every Director and employee must maintain the
accomplishments and potential, but confidentiality of the information with which they are
also on their principles and values. entrusted, including complying with information barrier
procedures applicable to our business. The only exception is
when disclosure is authorized or legally mandated.
It is impossible to predict the various different unique
circumstances our people will face during their careers. As
such, the policies outlined in this Code should be viewed Equal Employment Opportunities and
as the baseline of expected behavior. While ethical behavior Commitment to Diversity
requires us to comply fully with all laws and regulations, We do not tolerate any type of discrimination prohibited
“compliance” with the law is the minimum standard to which by law, including harassment. We value diversity as an
we hold ourselves. important asset that enhances our culture, helps us satisfy
customers well and maximizes return for shareholders.
Our Code of Conduct consists of the following principles For us to excel, we must create for our people an inclusive
which all Directors and employees are required to apply in environment that welcomes and supports differences and
their daily work and observe in the conduct of Company’s encourages input from all perspectives.
business.
Political Contributions and Activities
Compliance with Laws, Rules and
Directors and employees are prohibited from making or
Regulations soliciting political contributions or engaging in political
Every Director and employee must comply with all applicable activities.
laws, rules and regulations, including those related to insider
trading, financial reporting, money laundering, fraud, bribery Protecting and Properly Using
and corruption.
Company’s Assets
Everyone should protect the Company’s assets and ensure
Personal Conflicts of Interest
their efficient use. All Company’s assets should be used for
Every Director and employee is prohibited from indulging legitimate business purposes only.
in actions or relationships that create personal conflicts of
interest unless approved by the Company. It is important that
Public Relations
every Director and employee carefully considers whether
any of their activities or relationships, including business All employees share a responsibility for the Company’s good
or volunteer positions outside the Company, could cause public relations particularly at the community level. Their
a conflict or the appearance of a conflict with the interests readiness to help with religious, charitable, educational and
of the Company. Additionally, personal gain or advantage civic activities is accordingly encouraged provided it does
must never take precedence over one’s obligations to the not create an obligation that interferes with their commitment
Company. No Director or employee must ever use or attempt to the Company’s best interests.
COMPETING
Health & Safety Ingenuity
The Company has strong commitment to the health and We seek new opportunities and out-of-the-ordinary solutions.
safety of its employees and preservation of environment. We use our creativity to find unexpected and practical
The Company perseveres towards achieving continuous ways to solve problems. Our experience, technology and
improvement of its Health, Safety and Environment (HSE) perseverance enables us to overcome challenges and
performance by reducing potential hazards, preventing deliver value.
pollution and improving awareness. Employees are required
to operate the Company’s facilities and processes keeping Excellence
this commitment in view.
We make sure that we always do what we say we will and
strive for excellence and quality in everything that we do.
Non-Retaliation Policy
The Company strictly prohibits retaliation against anyone Personnel Development
who reports in good faith a possible violation of the Code, no
We are endeavored to foster a culture where people come
matter whom the report involves.
first and we hire, develop, train and retain our people to work
as synergized teams in line with our mission and vision.
We pledge to comply and enforce the basic principles of
Code of Conduct and prevent its violation. Any employee
observing any violation or abuse of this Code of Conduct Fairness
may bring the same to the notice of the Management in We are devoted to implement such policies and procedures,
writing. which translate into fair and equitable treatment of all
stakeholders, including selection, hiring, rewarding and
Culture compensating all employees.
Our culture demonstrates the manifestation of shared values Teamwork

and beliefs, which we practice every day to move towards a We are committed to fostering a culture where employees
better and more successful organization. Our values provide work as a team, listen to and respect each other, provide
the foundation of our culture and bind us into a successful support to one another, work co-operatively and highly
team yearning to outperform the competition. regard one another’s views, making our work environment
fun and enjoyable.
VALUES
We attribute our persistent growth to the strength of our deep Customer satisfaction
rooted values, which distinguish us and guide our actions. Our experience shows that if we satisfy our customers well,
We tend to conduct our business in a socially responsible our own success will follow.
and ethical manner.
Laws & regulations
Integrity
We are dedicated to complying fully with the letter and spirit
We are dedicated to maintaining the highest ethical of the laws, rules and ethical principles that govern us. Our
standards and ensuring openness and honesty in all our continued success depends upon unswerving adherence to
dealings by maintaining utmost integrity at all times. this standard.
Trust
We trust, respect and support each other, and we strive to Innovation
earn the trust of our customers and shareholders. While recognizing that the old way may still be the best way,
we constantly strive to find a better way of doing things. We
Diversity pride ourselves on having pioneered many of the practices
We provide equal opportunities to all our employees without and techniques that have become standard in the industry.
any bias against gender, race, ethnicity and religion.

2023 ANNUAL
REPORT 11
CODE OF CONDUCT, CULTURE,
VALUES & ETHICAL PRINCIPLES
Values
We attribute our persistent growth to the strength of our deep rooted values,
which distinguish us and guide our actions. We tend to conduct our business
in a socially responsible and ethical manner.
Integrity Trust
We are dedicated to maintaining We trust, respect and support
the highest ethical standards each other, and we strive to
and ensuring openness and earn the trust of our customers
honesty in all our dealings by and shareholders.
maintaining utmost integrity at
all times.
Diversity Ingenuity
We provide equal opportunities We seek new opportunities and
to all our employees without out-of-the-ordinary solutions.
any bias against gender, race, We use our creativity to find
ethnicity and religion. unexpected and practical
ways to solve problems. Our
experience, technology and
perseverance enables us to
overcome challenges and
deliver value.
Teamwork Excellence
We are committed to fostering a We make sure that we always
culture where employees work do what we say we will and
as a team, listen to and respect strive for excellence and quality
each other, provide support to in everything that we do.
one another, work co-operatively
and highly regard one another’s
views – making our work
environment fun and enjoyable.
COMPETING
Customer Personnel
Satisfaction Development
Our experience shows that if we We are endeavored to foster a
satisfy our customers well, our culture where people come first
own success will follow. and we hire, develop, train and
retain our people to work as
synergized teams in line with
our mission and vision.
Laws & Fairness

Regulations We are devoted to implement
We are dedicated to complying such policies and procedures,
fully with the letter and spirit which translate into fair
of the laws, rules and ethical and equitable treatment of
principles that govern us. Our all stakeholders, including
continued success depends selection, hiring, rewarding and
upon unswerving adherence to compensating all employees.
this standard.
Innovation
While recognizing that the old
way may still be the best way, we
constantly strive to find a better
way of doing things. We pride
ourselves on having pioneered
many of the practices and
techniques that have become
standard in the industry.

2023 ANNUAL
REPORT 13
COMPANY
PROFILE
Mughal Iron & Steel Industries Limited (“Mughal Steel”) was incorporated in
2010 as a public limited company. In 2011, the Company took over the running
business of a partnership concern by the name of “Mughal Steel” which had
been in the steel business for over 60 years and was being run by the major
sponsors of the Company. Today, the Company is one of the leading companies
involved in both ferrous and non-ferrous operations in Pakistan.
At Mughal Steel we work with passion and expertise to Steel re-bars cater to both housing sector market and large
develop high-quality diversified portfolio of quality products. infrastructure projects market, while girders mainly cater the
This means we create value for our customers and can housing sector market. The housing sector market for steel
successfully exploit the diverse opportunities in the markets re-bars comprises mainly of housing sector in the urban
of the future. Depth of technical and managerial expertise, areas, whereas, the housing sector market for girders mainly
reputation for reliability and a sharply defined business comprises of housing sector in the rural areas.
focus, has forged the organization into a modern, highly
competitive supplier of quality products. The Company’s The large infrastructure projects market on the other hand
ability to generate profits throughout the fluctuations of comprises of demand from different projects initiated by
various economic and business cycles is testimony to the various private sector, public sector and semi-government
strategic initiatives to continuously reinvest, modernize and institutions. Mughal Supreme steel re-bars are used to target
diversify. the housing sector in the urban areas since steel re-bars are
used for construction of roofs in urban areas, whereas G60
The Company is involved in multidimensional activities. steel re-bars are mainly used to cater large infrastructure
The products are grouped into ferrous and non-ferrous projects market. On the other hand, since girders are
segments. Ferrous segment mainly comprises of billets, products used for construction of roofs in rural areas,
girders and steel re-bars while non-ferrous segment mainly therefore they are used to target the rural housing market.
comprises of copper ingots, copper granules and iron waste.
The diversified product and market mix of the Company has The quality of all products is ensured at all stages of
been carefully designed to mitigate different risks. Being in through systematic and effective adoption, implementation,
the industry for over 5 decades has enabled the Company monitoring and continuous enhancement of quality control
to carefully nurture this portfolio enabling it to maintain its systems using latest methods of analysis. All stages of
competitive edge year over year. the production process right from the selection of raw
materials, processing of materials and the finished products
The main markets of the Company are domestic housing are subjected to rigorous testing, to ensure that each
sector market both in urban and rural areas, large item is of the highest quality. Our laboratory is equipped
infrastructure projects market and international market for with traditional chemical and mechanical analytical
copper products. Demand from rural markets is based upon machines besides the world’s renowned Optical Emission
various crop seasons while demand from urban markets is Spectrometer of M8 series. The Company has also installed
non-seasonal. Copper products are exported to Peoples’ Spectro lab for its girder mill for conducting chemical testing
Republic of China. There is no major seasonal impact on and procured copper content testing guns. The Company
demand for copper products except for impact of market is ISO-9001:2015 certified and truly implements Quality
shutdowns or holidays. Management System.
The management team is being led by Mr. Khurram Javaid,

Director and CEO.
COMPETING
KEY BRANDS
• Mughal Supreme
• Mughal Super Girder
Major Product Portfolio

The Company’s main product range comprises of the
following products:
• Steel re-bars (G60 / Mughal Supreme)

• Girders
• Billets
• Copper ingots
• Copper granules
Relationship with Group

Companies
The Company does not have any group companies apart
from those associated companies which are associated due
to common directorship.

2023 ANNUAL
REPORT 15
KEY
STRENGTHS
Diversified Product
and Market Portfolio
Backward
Integration
Economies
Global of Scale
Footprints
COMPETING
Cost Effective Diversified
Inbound Logistics
In-House
Electricity
Generation
Strong Brand
Recognition
Strong Clientele /
Distribution Network
One Stop Sale

Centers for Long
Technological Rolled Steel
Efficiencies Products

2023 ANNUAL
REPORT 17
COMPANY
INFORMATION
Board of Directors Company Secretary
Mr. Mirza Javed Iqbal Mr. Muhammad Fahad Hafeez
Mr. Abdul Rehman Qureshi Tel: +92-42-35960841 Ext: 155
Mr. Shoaib Ahmad Khan E-mail: [email protected]
Ms. Mariam Khawar
Mr. Jamshed Iqbal
Mr. Khurram Javaid
Share Registrar &
Mr. Muhammad Mubeen Tariq Mughal Transfer Agent
Mr. Fazeel Bin Tariq
Mr. Muhammad Mateen Jamshed THK Associates (Private) Limited
Plot No. 32-C, Jami Commercial Street 2,
Audit Committee D.H.A, Phase-VII, Karachi, Pakistan

Tel: +92-21-111-000-322
Fax: +92-21-34168271
Mr. Abdul Rehman Qureshi
Email: [email protected]
Mr. Muhammad Mateen Jamshed
Statutory Auditors
Human Resource and Fazal Mahmood & Company
Remuneration Committee Chartered Accountants
A member firm of PrimeGlobal
Mr. Abdul Rehman Qureshi
Mr. Mirza Javed Iqbal Muniff Ziauddin & Co.
Mr. Fazeel Bin Tariq Chartered Accountants
A member of BKR International
Chief Operating Officer

Shariah Advisor
Mr. Shakeel Ahmed
Tel: +92-42-35960841 Ext: 154 Mufti Imran Khan
E-mail: [email protected]
Legal Advisor
Chief Financial Officer
Muhammad Atif Butt
Mr. Muhammad Zafar Iqbal
Tel: +92-42-35960841 Ext: 138
E-mail: [email protected]
COMPETING
Tax Advisors Soneri Bank Limited
Samba Bank Limited
Akhtar Ali Associates Silk Bank Limited
Juris Counsel Summit Bank Limited
Farooq Khan Law Associates United Bank Limited
Butt & Company
Punjab Law Associates Geographical Presence
Shareholder Complaint Registered / corporate office
Handling Cell 31 –A Shadman I Lahore, Pakistan

Tel: +92-42-35960841-3
In case of shareholder complaint/queries, Fax: +92-42-35960846
Please Contact:
Mr. Zeeshan Ejaz Sale centres and warehouse
Tel: +92-42-35960841 Ext:136
Email: [email protected] Badami Bagh Lahore, Pakistan
Factory & warehouses

Bankers
17-Km Sheikhupura Road Lahore, Pakistan
Askari Bank Limited
Company Website:
Allied Bank Limited
Al Baraka Bank (Pakistan) Limited
Bank Alfalah Limited
The Company is operating website
BankIslami Pakistan Limited
www.mughalsteel.com containing
Bank of Punjab (Islamic Taqwa Division)
updated information regarding the Company.
Bank of Khyber
Bank Al-Habib Limited
Dubai Islamic Bank Limited
Faysal Bank Limited Note: MISIL’s Annual & Interim
Financial Statements are also available
Habib Bank Limited at the above website.
Habib Metropolitan Bank Limited
ICBC Bank Limited
JS Bank Limited
MCB Bank Limited
MCB Islamic Bank Limited
Meezan Bank Limited
National Bank of Pakistan
Scan QR Code
Standard Chartered Bank Limited for Website

2023 ANNUAL
REPORT 19
ENTITY
RATING
Pakistan Credit Rating Agency and VIS Credit Rating

Company Limited as per their latest reports till June 30,
2023 have issued following ratings:
Pakistan Credit Rating Agency VIS Credit Rating Company Limited
Long-Term A+ (A Plus) Long-Term A+(A Plus)

• High credit quality. • Good credit quality
• Low expectation of credit risk. • Protection factors are adequate
• The capacity for timely payment of financial • Risk factors may vary with possible changes in the
commitments is considered strong. economy.
• This capacity may, nevertheless, be vulnerable to
changes in circumstances or in economic conditions.
Short-Term A1 (A One) Short-Term A-1 (A One)

• A strong capacity for timely repayment. • High certainty of timely payments;
• Liquidity factory are excellent and supported by good
fundamental protection factors.
• Risk factors are minor.
COMPETING
SHARE PRICE
INFORMATION
Market Price Data

The following table shows month end wise share price of the Company that
prevailed during the financial years 2022-2023 and 2021-2022 in PSX:
2022-2023 2021-2022
Months High Low High Low
July 63.90 52.00 107.90 99.30
August 71.25 53.11 116.00 101.99
September 69.50 61.05 121.50 93.05
October 72.40 60.02 101.39 77.50
November 66.00 56.40 109.75 90.20
December 58.05 45.70 105.00 85.05
January 51.80 41.03 111.49 100.00
February 55.00 45.10 114.60 91.00
March 58.30 45.69 98.90 81.51
April 53.90 47.50 93.00 76.51
May 54.95 46.40 77.90 59.65
June 53.61 45.50 65.92 52.31

2023 ANNUAL
REPORT 21
ORGANIZATION
CHART &
OPERATING
STRUCTURE OF
THE COMPANY
COMPETING
Shareholders
Board of
Directors
Human Resource
Company Audit
& Remuneration
Secretary Committee
Committee
Internal
Audit
Executive Executive
Chief
Director Director
Executive Officer
(Finance) (Operations)
Procurement - Local
Chief Financial Officer Corporate Sales - Bar
Raw Material
Accounts Retail Sales - Bar Sales - Girder / Waste
Taxation Business Development Internal Logistics
Administration and
ERP Production and Planning
Security
Procurement General Stores -

Finance
Local (Rolling Mills)
Information Procurement General Stores -

Chief Operating Officer
Technology Local (Melting)
Procurement - Imported Raw-

Treasury Project Management
Material
Procurement - Imported
Marketing and Branding
Machinery
Human Resource
Supply Chain
Export Sales

2023 ANNUAL
REPORT 23
POSITION OF THE
ORGANIZATION IN
VALUE CHAIN
FERROUS
Truck
Imported Raw Karachi Port

Material
NON
FERROUS
Railway
COMPETING
Steel Billet Locally
Procured
Urban Housing
Sector - Re-bars
(Mughal Supreme)
Melting - Steel Billet Re - Rolling Finished Products:

Process Re-Bars
Girders
Rural Housing
Sector - Girders
Remeltable
Iron Scrap
Large Infrastructural Projects - Re-

bars (G-60)
Feed Stock Copper Granule

Processing - Machine
Feed Stock Melting - Copper Ingot Karachi Port Export

Processing - Mannual Copper Ingots /
Granules
Waste Sale

2023 ANNUAL
REPORT 25
AWARDS &
ACCOLADES
Over the years the Company has
bagged various awards and
accolades.
Best
Corporate
Best Export Report Award
Performance 2020
Award 2014 Certificate of Merit
Girders & T-Iron
Best Corporate
Report Award
Best 2021
Corporate Certificate of Merit
Report Award
2019
Certificate of Merit
Best Corporate
Report Award
2018
Certificate of Merit
Best Presented
Brand of Annual Report
the Year Awards SAFA 2017
Award 2011
Girders & T-Iron
COMPETING
HISTORY OF
MAJOR EVENTS
The Company follows the period of July 2022 to June 2023 as the financial year.
20 July
Redemption of Islamic
29 November
Corporate Briefing Session
Commercial paper - I - 2023
12 August
Independence Day 02 December
Sukuk-I Redemption – 7th
Celebrations Rental and 3rd Principal
February
02 September
Sukuk-I Redemption – 6th 20 Approval of Interim Accounts for
the quarter and half year period
Rental and 2nd Principal
ended December 31, 2022
September March
20 02
Approval of Annual Audited Sukuk-I Redemption – 8th
Accounts for the year ended Rental and 4th Principal
June 30, 2022
October
28 06
April
Approval of Interim
Issuance of Commercial
Accounts for the quarter
Paper – II
ended September 30, 2022
April
31 October
13th Annual General
28 Approval of Interim Accounts
for the quarter and nine months
Meeting
period ended March 31, 2023.
June
October Sukuk-I Redemption – 9th
25 Mehfil-e-Milad 02 Rental and 5th Principal
November
June
11-12 Sports Gala
12 Successful CoD of Recycling plant
for non-ferrous segment

2023 ANNUAL
REPORT 27
CORPORATE
GOVERNANCE
At Mughal Steel, we are firmly 3. has, or has had within the last three years, a material
committed to ensuring the highest business relationship with the Company either
directly, or indirectly as a partner, major shareholder or
level of good governance through
director of a body that has such a relationship with the
adoption of the best corporate Company;
governance practices and monitoring
4. has received remuneration in the three years preceding
their effectiveness. his/her appointment as a Director or receives additional
remuneration, excluding retirement benefits from the
Leadership Structure Company apart from a Director‘s fee or has participated
of those Charged with

in the Company‘s stock option or a performance related
pay scheme;
Governance 5. is a close relative of the Company‘s promoters,
Directors or major shareholders;
BOARD STRUCTURE 6. holds cross-directorships or has significant links with
The size and composition of the Board of Directors has been other directors through involvement in other companies
formulated with a view to ensure a balance of Executive or bodies; and
and Non-Executive Directors, including Independent
7. has served on the Board for more than three
Directors with the requisite skills, competence, knowledge
consecutive terms from the date of his first appointment.
and experience so that the Board as a group includes core
competencies and diversity, including gender, considered
relevant in the context of the Company’s operations. The Roles and Responsibilities of the
Board comprises of suitably experienced and qualified Board of Directors and How the Board
professionals in order to ensure effective and efficient Operates
decision making. Detailed profiles of Directors have been The Directors are fully aware of the level of trust entrusted
stated in the annual report. in them by the shareholders for managing the affairs of
the Company and safeguarding their interests. Thereby,
Justification of Independent Director the Board exercises its powers and carries out its
With a view to promote effective Corporate Culture fiduciary duties with a sense of objective judgement and
and Corporate Governance within the Company, three independence in the best interests of the Company.
Independent Directors have been performing their
fiduciary duties in Board. Moreover, in order to ensure their Offices of the Chairman & Chief
independence, none of the Independent Director: Executive Officer
As part of our governance structure, the position of the
1. has been an employee of the Company, any of its
Chairman of the Board of Directors and the office of the
subsidiaries or holding company within the last three
Chief Executive Officer are held separately, with clear division
years;
of roles and responsibilities.
2. is or has been the Chief Executive Officer of
subsidiaries, associated company, associated
undertaking or holding company in the last three years;
COMPETING
Brief Role & Responsibilities of Matters Delegated to Management by
Chairman & CEO the Board
The Chairman represents the Non-Executive Directors Management is primarily responsible for implementing
of the Board and is entrusted with the leadership of the the strategies as approved by the Board of Directors. It is
Board’s proceedings. The Chairman acts as the head of the responsibility of management to conduct the routine
the Board meetings and is responsible for avoidance of business operations of the Company in an effective and
conflicts of interests. He has the power to set the agenda, ethical manner in accordance with the strategies and goals
give directions and sign the minutes of the Board meetings. as approved by the Board and to identify and administer the
The Chairman is also responsible for assessing and key risks and opportunities which could impact the Company
making recommendations regarding the effectiveness of in the ordinary course of execution of its business.
the Board, the committees and individual Directors. The
Chairman ensures effective role of the Board in fulfilling all its Annual Evaluation of Board
responsibilities. Performance and Evaluation Criteria
The CEO is an Executive Director who also acts as the
for Board Performance
head of the Company’s Management. He is entrusted with Corporate governance requires boards to have effective
responsibility of: processes and to evaluate their performance and appraise
directors at least once a year. The Board of Directors has put
• Safeguarding of Company’s assets in place a mechanism for undertaking annual evaluation of
the performance of the Board.
• Creation of shareholder value
• Identification of potential diversification / investment Review of Chairman Performance and
projects
Criteria
• Implementation of projects approved by the Board
The Chairman has the overall responsibility of the board
• Ensuring effective functioning of the internal control evaluation. However, the performance of Chairman is also
system evaluated which is linked to both the functioning of the
• Identifying risks and designing mitigation strategies overall board as well as the performance of each Director.
• Preservation of the Company’s image

Review of CEO Performance and
• Development of human capital and good investors’ Criteria
relations
The performance evaluation is based on the various financial
• Compliance with regulations and best practices and non-financial key performance indicators. The Board
evaluates the actual performance against those KPIs during
Meetings of the Board of Directors the year and discusses the future course of action to attain
Legally, the Board is required to meet at least once per the Company’s stated goals.
quarter to monitor the Company’s performance aimed
at effective and timely accountability of its management. Formal Orientation at Induction
Special meetings may also be called to discuss other Each new member of the Board is taken through an
important matters on need basis. orientation process at the time of induction, and is trained
extensively for enhancement of management skills.

2023 ANNUAL
REPORT 29
Directors’ Training Program Evaluation of Committees’
Following Directors have certification under the Directors’ Performance and Criteria
Training Program (DTP): The rationale for the formation of board committee is to
enhance the efficiency and to share the work load of the
1. Mr. Mirza Javed Iqbal Board. The performance of the committees is evaluated
2. Mr. Khurram Javaid on the basis of the terms of reference of the respective
committees.
3. Mr. Jamshed Iqbal
4. Mr. Muhammad Mubeen Tariq Mughal
Issues Raised at Last AGM
5. Mr. Fazeel Bin Tariq
6. Mr. Muhammad Mateen Jamshed During the proceedings of 13th Annual General Meeting of
the Company held on October 31, 2022 general clarifications
7. Ms. Mariam Khawar were sought by the members on Company’s published
financial statements, however, no significant issue was
In addition to the above, Mr. Abdul Rehman Qureshi has raised.
availed the exemption from DTP.
Presence of Chairman of
Board Committees
Audit Committee at the
Audit Committee
AGM
The Committee comprises of three non-executive Directors
with the Chairman being an Independent Non-Executive The Chairman of Audit committee was present in last Annual
Director. The Board of Directors has approved the terms General Meeting of the Company.
of reference of the Audit Committee. The Board provides
adequate resources and authority to enable the Audit
Committee to carry out its responsibilities effectively. The
Transaction / Trade In
Committee meets at least once every quarter of the financial Company’s Shares
year.
All the trades in shares of the Company carried out by the
Directors, Executives and their spouses and minor children
Human Resource and Remuneration
during the financial year 2023 are disclosed in Pattern of
Committee shareholding annexed to the Annual Report.
The Human Resource and Remuneration Committee
comprises of three Non-Executive Directors with the Executives include Chief Executive Officer, Chief Operating
Chairman being an Independent Non-Executive Director. Officer, Chief Financial Officer, Head of Internal Audit and
The role of the Human Resources & Remuneration Company Secretary and certain other employees for whom
Committee is to assist the Board of Directors in its oversight the Board of Directors will set a threshold. In accordance
of the evaluation and approval of the policy framework for with the threshold set by the Board of Directors, employees
determining remuneration of Directors, employee benefit who are drawing annual basic salary of Rs. 3.6 million or
plans, welfare projects and retirement emoluments. The more are regarded as Executives.
Committee meets at least once in a financial year and may
meet more often if requested by a member of the Board, or
committee itself or the Chief Executive Officer.
COMPETING
Whistle Blowing Policy Succession Planning
As part of our firm commitment to highest standards of The Company believes in proactive approach towards
ethical, moral and legal business conduct and in line with succession planning. We recruit employees, develop
our policy towards open communication, we have devised their knowledge, skills, abilities, and prepare them for
a whistle blowing mechanism for sounding of alerts against advancement or promotion into ever more challenging roles.
deviations from policies, controls, applicable regulations, or Succession planning ensures that employees are constantly
violation of the code of professional ethics / conduct. developed to fill each needed role. We look for people who
exemplify continuous improvement when we are spotting
Human Resource future successors.
Management Social and Environmental

Human Resource Management (HRM) is an integral part Responsibility Policy
of our business strategy. The Company fosters leadership,
individual accountability and teamwork. The Social and Environmental Responsibility Policy reflects
the Company’s recognition that there is a strong, positive
The main objectives of the Company’s HRM policy are: correlation between financial performance and corporate,
social and environmental responsibility. We are committed to
• Selecting the right person, with the right experience, at act responsibly towards the community and environment for
the right time and offering the right compensation. our mutual benefit. Our Social and Environmental practices
have been elaborated in the relevant section of the Directors’
• Developing management philosophies and practices to
report.
promote and encourage motivation and retention of the
best employees.
• Recognizing and rewarding employees’ contribution to Investors’ Grievances
the business.
Policy
• Fostering the concept of team work and synergetic
efforts. Investor queries and complaints constitute an important
voice of Investor, and this policy details grievance handling
• Encouraging and supporting team concepts and team
through a structured grievance framework. Grievance
building techniques.
policy is supported by a review mechanism, to minimize
• Nurturing a climate of open communications between the recurrence of similar issues in future. The Company’s
management and employees. Grievances policy follows the following principles:
• Making all reasonable efforts to achieve a high quality of
work-life balance. • Investors are treated fairly at all times.
• Complaints raised by Investors are dealt with courtesy
and in a timely manner.
• Investors are informed of avenues to raise their queries
and complaints within the organization, and their rights
if they are not satisfied with the resolution of their
complaints.

2023 ANNUAL
REPORT 31
• Queries and complaints are treated efficiently and fairly. of on-site and remote reserve sites to maintain real-time
backup of all primary data. All record must be retained
• The Company’s employees work in good faith and
for as long as it is required to meet legal, administrative,
without prejudice, towards the interests of the Investors.
operational and other requirements of the Company.
Stakeholders’ Engagement Board’s Policy on Diversity

Process and Frequency of
Such Engagements
We do not tolerate any type of discrimination prohibited
by law, including harassment. We value diversity as an
important asset that enhances our culture, helps us satisfy
The development of sustained stakeholder relationships
customers well and maximizes return for shareholders.
is paramount to the performance of any Company. From
For us to excel, we must create for our people an inclusive
short-term assessments to long-term strategic relationship
environment that welcomes and supports differences and
building, ‘Stakeholders Engagement’ lies at the core of our
encourages input from all perspectives.
business practices to promote improved risk management,
compliance with regulatory and lender requirements in
addition to overall growth of the Company. Governance Practices
Exceeding Legal
Investors’ Relations Requirements
Section on Website
We have always believed in implementation of effective
Detailed Company information regarding financial highlights, Governance reporting framework that provides insight
investor information, share pattern/value and other requisite information to all stakeholders. In line with this strategy, not
information specified under the relevant regulations, has only have we complied with all mandatory legal compliances
been placed on the corporate website of the Company, under the Listed Companies (Code of Corporate
which is updated on regular basis. In order to promote Governance) Regulations, 2019, the Companies Act, 2017
investor relations and facilitate access to the Company for and other applicable rules, regulations and standards, we
grievance / other query registration, an ‘Investor Relations’ have also carried out the following activities in addition to the
section has also been introduced on our website. legal requirements;
IT Governance Policy a. Other information:

The management reports include various other essential
At Mughal Steel we are strongly committed in continuously information in this annual report which is not required
exploring the prospects of implementing the best and latest under law.
IT technologies and infrastructure to enable efficient and
timely decision making, in addition to economizing on the
b. Dispersal of information:
costs related to operating and decision-making processes.
The Company has always ensured that all material
Policy For Safety & Security

information is communicated to the PSX, the SECP and
the Company’s shareholders as soon as it becomes
Of Records available. At all times we have ensured that such
information is sent out much before the deadlines set
Safety and security of IT data / record is ensured through out in the laws.
effective implementation of the Company’s policy for “Safety
of Records” which includes access controls by way of
security codes/passwords etc., in addition to establishment
COMPETING
c. Implementations of HSE: Statement of Unreserved
The Company has developed and implemented
aggressive HSE strategies at its Plants to ensure safety
Compliance of
of its people and equipment. International Financial
Reporting Standards (IFRS)
Management’s Issued By International
Responsibility Towards Accounting Standards
the Preparation and Board (IASB)
Presentation of Financial
Statements
The Company is preparing its statutory Financial Statements
in accordance with the accounting and reporting standards
as applicable in Pakistan. The accounting and reporting
The Company, its Board of Directors and the management
standards applicable in Pakistan comprise of International
have always been keen to follow the standards set down by
Financial Reporting Standards (IFRS) issued by the
governing institutions. In lights of the same strict compliance
International Accounting Standards Board (IASB) as notified
of all standards set out by the Companies Act, 2017, the
under the Companies Act, 2017, the Islamic Financial
International Financial Reporting Standards have been
Accounting Standards (IFAS) issued by the Institute of
adhered to and otherwise good and responsible reporting
Chartered Accountants of Pakistan as are notified under the
has been our general practice.
Companies Act, 2017 and the provisions of and directives
issued under the Companies Act, 2017. Where provisions
of and directives issued under the Companies Act, 2017
differ from the IFRS, the provisions of and directives issued
under the Companies Act, 2017 are followed. In addition
to this, relevant notes to the annexed financial statements
specify few standards and interpretations which are yet to be
effective in Pakistan and have not been early adopted by the
Company.

2023 ANNUAL
REPORT 33
BOARD
PROFILE
The Board comprises of members having
appropriate mix of core competencies,
diversity, requisite skills, knowledge and
experience. The key skills and experience
of the Directors are set out below:
MR. MIRZA JAVED IQBAL
Non – Executive Director - Chairman of the Board
Having joined his family business in 1976, Mr. Javed Iqbal rose to become
a pioneer of the steel industry of Pakistan. During his exemplary career, Mr.
Iqbal challenged and changed the personal and industry mindset, both
within and beyond the business framework. He has not only developed new
pathways to achieve energy efficiency and economies of scale, but has made
remarkable contributions towards the technological advancement and effective
documentation of the national steel industry. With his visionary leadership and
unparalleled expertise, Mr. Iqbal has been the driving force behind the Company’s
success – making the Company reach new heights of growth and expansion.
MR. ABDUL REHMAN QURESHI

Non- Executive Director - Independent
Mr. Qureshi is a law graduate from the Punjab University, Lahore. He is a veteran
in the field of corporate law and related matters. He has over the years, served in
various capacities erstwhile in Corporate Law Authority (CLA) and the Securities
and Exchange Commission of Pakistan (SECP). He has been member of various
committees and commissions constituted to review and revamp company
law, securities law, insurance law and banking laws. He has attended several
international courses, seminars, training programs and workshops on various
subjects related to corporate laws and corporate governance particularly in
countries like Australia, Japan, lndia, USA and U.K.
MR. SHOAIB AHMAD KHAN

Mr. Shoaib holds MSc (DSS) degree from National Defense University, Islamabad
and MBA degree from IBA, University of the Punjab, Lahore. He has 35 years
of experience in Financial Management, Banking, Accounting & Auditing,
Administrative & Regulatory aspects. In addition to above, he has vast experience
in project appraisal, monitoring & restructuring and development of strategies.
During his career, he remained Director and member finance of National Highway
Authority (NHA), Islamabad.

2023 ANNUAL
REPORT 35
MS. MARIAM KHAWAR
Ms. Mariam Khawar holds MSc (Statistics) degree from Government College
University Lahore (GCU) Pakistan. She is also a fellow member of Institute of Cost
& Management Accountants of Pakistan (ICMAP). She has more than 18 years of
experience in the fields of Corporate Affairs, Finance, Legal, Administration, and
Human Resource.
MR. JAMSHED IQBAL

Executive Director
Mr. Jamshed has over the years played a pivotal role in developing and
maintaining the clientele network across Pakistan to ensure that all kinds of
geographical requirements are met by the Company, a feat that has resulted
in expanded growth of the Company. Today his vast experience and in-depth
knowledge of the steel sector and consumer market is highly beneficial at the
Board and operational level.
MR. KHURRAM JAVAID

Executive Director - Chief Executive Officer
Mr. Khurram Javaid holds an MBA from the Coventry University, UK. As the
company’s CEO, Mr. Khurram has spearheaded Mughal Steel’s initiatives
in transforming the Company into a highly competitive organization through
modernization of manufacturing facilities, improving quality of products,
developing of diversified product and market portfolio, identifying new markets,
strengthening and broadening the sales network within the country, creating
efficiencies in inbound logistics and investment in alternate sources of energy. His
efforts have resulted in enabling the company to deliver year on year improved
performance and to steer through difficult times.
COMPETING
MR. MUHAMMAD MUBEEN TARIQ MUGHAL
Executive Director
Mr. Mubeen has academic background in economics & finance and has done his
Executive MBA (Leadership & Strategy) from London Business School (LBS). He
is responsible for the Financial Management of the Company. His astute financial
acumen combined with in-depth knowledge of steel manufacturing operations has
over the years resulted in improved operational efficiencies, optimum utilization
of funds, better working capital management and strengthening of internal and
financial controls. He has been responsible for initiating professionalization of the
organization by developing and reorganizing the human resource function, making
it more effective as a strategic business function.
MR. FAZEEL BIN TARIQ

Non - Executive Director
Mr. Fazeel holds a Bachelor’s Degree in Business Administration from the Lahore
School of Economics, Pakistan and a Postgraduate degree in Professional
Accounting from the Swinburne University of Technology, Australia. He has also
done Masters in Leadership from Northeastern University, Boston, USA. He has
extensive knowledge and experience of re-rolling production processes.
MR. MUHAMMAD MATEEN JAMSHED

Non - Executive Director
Mr. Mateen holds a Bachelor’s Degree in Business Administration from the Lahore
School of Economics, Pakistan.

2023 ANNUAL
REPORT 37
02
DIRECTORS’
REPORT
• Chairman’s Letter To The Shareholders
• Chief Executive Officer’s Remarks
• Directors’ Report To The Shareholders
• ‫شئیر ہولڈرز کے لئے ڈائریکٹرز کی رپورٹ‬
• ‫چیف ایگزیکٹو آفیرسکا تبرصہ‬
• ‫شئیر ہولڈرز کیلئے چیرئمین کا خط‬
CHAIRMAN’S LETTER TO
THE SHAREHOLDERS
The challenges of the past year have been manifold. In The objective of the Board has been to ensure that the
particular, the political and economic situation over the organization is being managed effectively, in a way that
last year has resulted in unimaginable challenges, having helps it to achieve its objectives whilst also safeguarding
massive impact on almost every business and industry. the integrity of the organization and the interests of its
stakeholders.
At Mughal Steel, we are strong believers that challenges
are merely opportunities waiting to be uncovered. Hence, Overall, the Board has worked well given its organizational
despite these challenges, we never wavered from our model and board structure, with Board members having
corporate mission and remained true to the core of our the appropriate range of skills, knowledge and experience,
strategy and once again posted remarkable performance. as well as the degree of diversity, necessary to enable it to
effectively govern the business.
Despite all the challenges, Your Company successfully
commissioned state-of-the-art recycling plant. With The Board committees as well continued to work efficiently
the commissioning of the new plant, Mughal Steel has as designated by the Board. Minimum targets set for
strengthened its competitive advantage both in the ferrous attendance of Board members at Board meetings were duly
and non-ferrous segment. The plant will not only fuel growth met.
in exports sales in the form of copper but also cater ferrous
segment through supply of quality raw material refined in The role of the Board has remained pivotal in achieving
house. On the performance front, the Company posted the Company’s objectives. The Board regularly reviewed
topline of Rs. 67.390 billion for the year ended June 30, 2023 the principal risks and mitigating factors against them.
as compared to Rs. 66.153 billion last year and net profit of The Board’s role in diversifying the product and market
Rs. 3.480 billion as compared to Rs. 5.411 billion last year. In portfolio, increasing production capacities, investing in new
view of the foregoing, the Board has decided to recommend technologies and maintaining sustained production levels
a final cash dividend of Rs. 3.20 per share. has been effective. The contribution and efforts of all Board
members has been very vital.
However, success is not defined by a moment in time,
success is a journey. It is a journey that does not end with a Lastly, I would also like to recognize the efforts of our
single achievement, it is continuous with the bar constantly executive management team for their prudent and insightful
rising higher and higher and that is why we mainly focus on leadership during the past year together with their ability to
competing with our own yesterday. That is the journey we are be flexible and react quickly when it became necessary to
on and we are excited about taking the next steps. Indeed, protect the business against various adversities.
we are extremely well positioned to continue our journey by
further nurturing and developing our diversified product and I would also like to express my gratitude for the efforts of all
market portfolio across geographical boundaries. our employees for their dedication and stakeholders for their
trust in us.
Review of Board Your trust and support, alongside the dedication and hard
Performance work of our employees, have always been the bedrock of
our success, and for that, I on behalf of the Board extend my
As the Chairman of the Board, I hereby present the review gratitude.
on the overall performance of the Board and Board’s role in
achieving the Company’s objectives as required u/s 192 of
Companies Act, 2017.
The Company has a diverse and competent Board of

Directors which holds to the Company’s vision and mission
with the ultimate goal of serving the interests of stakeholders.
During the year, there were no changes on the Board.

However, the term of office of the Board of Directors expired
Mirza Javed Iqbal
Chairman of the Board / Director
during the year and all the retiring Board members were re-
elected unanimously.
Lahore: September 22, 2023
COMPETING
CHIEF EXECUTIVE
OFFICER’S REMARKS
The year under review has been marked by both triumphs Lastly, I’d like to thank our employees, our business partners
and trials. The economic and political landscape presented and our members for their support. In 2023, we will continue
us with unprecedented challenges, pushing our resilience to work to further improve our performance. I am confident
to the forefront. Inflation, high interest rates, currency that the entire Mughal Steel team will collectively work to
devaluation, rising energy costs, volatile geopolitical make us a stronger Company.
environment, fluctuating demand patterns, increased
competition, and volatile raw material prices exerted Thank you for being a part of our journey. Together, we shall
significant pressure on our operations, supply chain, and continue to rise above challenges and shape a prosperous
profitability. tomorrow.
Despite of these challenges, I want to emphasize that

Mughal Steel’s commitment to excellence remains
unshaken. I am pleased to report that your Company
demonstrated resilience and performed exceptionally. Our
commitment to operational excellence, strategic planning,
and strong leadership enabled us to navigate these
challenges effectively. We witnessed steady topline and
achieved profitability a result of adhering to our diversification
strategy, implementing prudent cost management measures,
and exploring new market opportunities.
As we move forward, we are buoyed by the resilience

that defines Mughal Steel. Our strategic roadmap for
the upcoming year is built upon leveraging opportunities
within adversity, diversifying our revenue streams, and
Khurram Javaid
Chief Executive Officer / Director
reinforcing our market presence. We remain confident
that our unwavering commitment to diversification, quality,
innovation, and sustainability will pave the way for a brighter Lahore: September 22, 2023
future.

2023 ANNUAL
REPORT 43
DIRECTORS’ REPORT
TO THE SHAREHOLDERS
The Directors of the Company are Sales and marketing expenses decreased by 36.84% mainly
pleased to present their report due to decline in advertisement budget. Other charges
decreased by 33.63% mainly due to decrease in provisions
together with the Annual report of the for workers’ profit participation fund and workers’ welfare
Company along with Audited Financial fund which was in line with decrease in profits. Finance costs
Statements for the year ended June 30, increased by 68.69% mainly due to increase in profit / mark-up
rates.
2023.
Major transfers from capital work-in-progress to property, plant
The financial highlights of the Company for the year ended June
& equipment mainly represented expenditure related to new
30, 2023 are as follows:
recycling plant for non-ferrous segment. Further, revaluation was
carried out as at June 30, 2023 resulting in revaluation surplus
Year Ended June 30, of R. 1,971.478 million. Trade debts increased by 66.56% mainly
Variance
2023 2022 due to increase in sale rates and temporary increase in credit
days. Loans and advances increased by 190.94% and mainly
(Rs. in Millions) %
represented advances to suppliers against local material.
Sales 67,390.171 66,152.808 1.87% Deposits, prepayments and other receivables increased by
Gross profit 9,671.028 10,127.887 4.51% 231.75% mainly due to increase in guarantee margin in respect
Profit before taxation 4,346.397 6,201.983 (29.92%) of supply of steel bars and girders. Cash and bank balances
decreased by 44.26% mainly on account of utilization of funds
Taxation (865.912) (791.024) 9.47%
accumulated last year for meeting re-payment of Islamic
Profit for the year 3,480.485 5,410.959 (35.68%) commercial paper (ICP) due in July 2022.
Earnings per share – Basic
10.37 16.12 (35.68%) Revaluation surplus and deferred taxation increased on account
and Diluted (Rs.)
of revaluation surplus recognized during the year and increase
in tax rates. Accrued profit/interest/mark-up increased mainly
Business, Financial & due to increase in profit / mark-up rates. During the year, the
Operational Review Company issued Commercial Paper (ICP) of 270 days tenor.
The proceeds therefrom were utilized to finance the Company’s
working capital requirements. The Company constantly monitors
Political turmoil, devastating floods, volatile global commodity
cash flows to ensure overall liquidity and was able to manage
prices, increased energy tariffs, rupee depreciation, high
its operating cash flows by ensuring tight credit controls, better
discount rates, rising inflation and disruptions arising from
collections and inventory management.
administrative import controls, slowed down overall industrial
activity with deteriorating consumer and investor confidence and
All contingencies and commitments have been disclosed in
impacted the overall performance of the Company.
detail in relevant notes to the financial statements.
However, amidst the prevailing adversities, the Company
Furnaces generated an overall production of 181,690 MT,
managed to register its highest topline in absolute terms. Sale
recording a decrease of 30.57% from previous year. The
increased by 1.87% as compared to last year. Out of total
overall production of rolling mills was recorded at 188,710
sales, total sales for ferrous segment decreased by 2.52%,
MT, showing an overall decrease of 39.05% over the previous
whereas sales for non-ferrous segment increased by 13.66%
year. The overall production of copper ingot melting was
as compared to last year. The overall increase in topline was
recorded at 5,988 MT as compared to 8,317 MT of production
mainly associated with increase in sale prices, whereas,
in the previous year. In addition, the Company commenced
volumes witnessed decline due to overall economic slowdown.
operations of its recycling plant for non-ferrous segment with
Decrease in sales commission was due to decrease in sales
annual processing capacity of 90,000 MT against which 5,600
through commission agents. Gross margins of both ferrous and
MT of feedstock was processed during the year.
non-ferrous segments witnessed decline. Overall, margins were
adversely impacted due to various adversities but the adverse
The Company’s asset base recorded an increase of Rs.
impacts were curtailed to large extent mainly due to effective
6,746.528 million compared to last year. Resultantly, the
inventory and logistics management.
Company’s net worth as at June 30, 2023 stood at Rs.
25,372.436 million as compared to Rs. 20,847.078 million as at
June 30, 2022 with a breakup value of Rs. 75.60 per share as at
June 30, 2023 as compared to Rs. 62.11 as at June 30, 2022.
COMPETING
Dividends and c. Authorization to the Board of Directors, to issue 50.000
million ordinary Class-C shares of Rs. 10/- each as and
Appropriations when deemed fit, with such rights and privileges as
mentioned in the notice of the said EOGM.
Rs. in Millions Except as otherwise disclosed, there were no other material

changes or commitments which have occurred between the
Un-appropriated profit brought forward 11,167.653 end of financial year of the Company to which the financial
Profit for the year 3,480.485 statements relate and the date of this report.
Remeasurement gain on defined

benefit obligation
2.662
Principal Activities
Incremental depreciation relating to
revaluation surplus
61.966 of the Company and
Profit available for appropriations 14,712.766 Development and
Appropriations: Performance of the
Less: Proposed cash dividend @ 32%
(Rs. 3.20 per share)
1,074.029 Company’s Business
Un-appropriated profit carry forward 13,638.737 During the Year
The Company’s operations comprise of ferrous and non-ferrous
The Board of Directors in its meeting held on September 22, segments. However, the principal activity of the Company is
2023 has proposed a final cash dividend @ of 32% i.e. Rs. 3.20 manufacturing and sale of mild steel products. The details
per share for the year ended June 30, 2023. These financial related to development and performance of the Company’s
statements do not include the effect of the above appropriation, business has been provided in relevant areas of the Directors’
which will be accounted for in the year in which it is approved. report.
Adequacy of Internal
Subsequent Events / Financial Controls
Material Changes
The Directors are aware of their responsibility with respect
The Members of the Company in their Extraordinary General to internal financial controls. Through discussions with
Meeting (EOGM) held on September 19, 2023 have approved management and Auditors (both internal and external), they
the following: confirm that adequate internal controls have been implemented
by the Company.
a. Purchase of 174.692 million fully paid ordinary shares
and 22.570 million fully paid Class-B shares of Mughal
Energy Limited (an associated company) for an aggregate Composition of the Board
consideration of Rs. 3,150.000/- million, whereby, Mughal
The Board comprises of nine members. The composition of
Energy Limited will become wholly owned subsidiary of the
the Board is in compliance with the requirements of the Listed
Company.
Companies (Code of Corporate Governance) Regulations, 2019.
b. Increase in authorized capital of the Company from Rs. The composition as at the close of the financial year was as
5,000.000 million divided into 500.000 million ordinary follows:
shares of Rs. 10/- each to Rs. 10,000.000 million divided
into 700.000 million ordinary shares of Rs. 10/- each, Total number of Directors:
250.000 million ordinary Class-B shares of Rs. 10/- each (a) Male 8
and 50.000 million ordinary Class-C shares of Rs. 10/- (b) Female 1
each.

2023 ANNUAL
REPORT 45
Composition:
Names of Members of the
Independent Directors
Non-Executive Directors
3*
3
Board Committees
Executive Directors 3
Audit committee
* Includes two male and one female independent Director.
During the financial year four meetings of the committee
were conducted, detail of which are as follows:
Changes to the Board
and its Committees S.
No.
Name of Members Designation Attendance
Mr. Abdul Rehman

There were no changes during the year to the Board or its 1. Chairman / Independent Director 4
Qureshi
Committees, however, the Board was re-constituted due to the
election of Directors, with all the retiring Board and committee 2. Mr. Fazeel Bin Tariq Member / Non-Executive Director 4
members getting re-elected. Mr. Muhammad
3. Member / Non-Executive Director 4
Mateen Jamshed
Names of Persons who During the year, the Committee was re-constituted post-
at any Time During the election of Directors. However, there was no change in the
Financial Year Were

members of the Committee.
Directors of the Company Human resource and remuneration

(HR&R) committee
Following are the names of the persons who, at any time during
the financial year, were Directors of the Company: During the year two meetings of the committee were
conducted, detail of which are as follows:
Attendance
S.
Name of Directors Designation in board S.
No. Name of Members Designation Attendance
meetings No.
1. Mr. Mirza Javed Iqbal Chairman / Non-Executive Director 5 Mr. Abdul Rehman
1. Chairman / Independent Director 2
Qureshi
Mr. Abdul Rehman
2. Independent Director 5
Qureshi 2. Mr. Mirza Javed Iqbal Member / Non-Executive Director 2
Mr. Shoaib Ahmad 3. Mr. Fazeel Bin Tariq Member / Non-Executive Director 2
3. Independent Director 5
Khan
4. Ms. Mariam Khawar Independent Director 5 During the year, the Committee was re-constituted post-
5. Mr. Jamshed Iqbal Executive Director 5 election of Directors. However, there was no change in the
6. Mr. Khurram Javaid CEO / Executive Director 5 members of the Committee.
Mr. Muhammad
Directors’ Remuneration
7. Executive Director 5
Mubeen Tariq Mughal
8. Mr. Fazeel Bin Tariq Non-Executive Director 5
Mr. Muhammad The remuneration of Board Members is approved by

9. Non-Executive Director 5
Mateen Jamshed the Board. However, it is ensured that no Director takes
part in deciding his own remuneration. Appointments of
During the financial year 5 meetings of the Board of Directors Executive Directors for holding office of profit other than
were conducted. No meetings were held outside Pakistan during the Chief Executive Officer are approved by the members
the year. Leave of absence (if any) was duly taken. of the Company. Non-Executive Directors and Independent
COMPETING
Directors are only paid meeting fee. For information placed before the Board for review and approval. In addition
on remuneration packages of Directors and CEO and to the above, as required under Companies Act, 2017,
aggregate amount charged in these financial statements, details of contracts or arrangements entered into along
please refer relevant notes to the financial statements. with the justifications for entering into such contracts or
arrangements have been disclosed in relevant notes to the
Pattern of Shareholding financial statements.
Information about the pattern of holding of the shares is Policy for Related Party
Transactions
annexed
Segmental Review of The Board of Directors has approved a policy for related
Business Performance party transactions, which require that the Company shall
carry out transactions with its related parties on an arm’s
Information about segmental review has been given in length basis in the normal course of business. The term
relevant areas of the Directors’ report and also detailed in the ‘arm’s length’ requires conducting business on the same
relevant notes to the financial statements. terms and conditions as the business between two unrelated
/ unconcerned persons. The policy specifies that all
transactions entered into with related parties shall require
Changes in Nature Board’s approval, however, where majority of the Directors
of Business are interested, such transactions shall be approved/ratified

by the members at the general meeting.
There has been no change in nature of the business of the
Company during the year, nor were there any companies
in which the Company had any interest therein, except as
Financial & Corporate
disclosed elsewhere. Reporting Framework
In compliance with the Corporate and Financial Reporting
Auditors Framework of the Code of Corporate Governance, the
Directors confirm the following:
The present joint auditors of the Company M/s. Fazal
Mahmood & Co., Chartered Accountants and M/s. Muniff a) The financial statements, prepared by the management
Ziauddin & Co. have completed their audit for the year of the Company, present fairly its state of affairs, the
ended June 30, 2023 and have issued an unmodified result of its operations, cash flows and changes in
audit report. The auditors will retire at the conclusion of the equity.
forthcoming Annual General Meeting of the Company, and
being eligible; have given their consent for re-appointment b) The Company has maintained proper books of
as joint auditors for the year ended June 30, 2024. The accounts.
Board has recommended the appointment of M/s. Fazal c) Appropriate accounting policies have been consistently
Mahmood & Co., Chartered Accountants and M/s. Muniff applied (except as disclosed in annexed financial
Ziauddin & Co. as joint auditors for the ensuing year, as statements) in preparation of the financial statements
recommended by the Audit Committee, subject to approval and accounting estimates are based on reasonable and
of the members in the forthcoming Annual General Meeting. prudent judgement.
d) International Financial Reporting Standards (IFRS),
Related Party Transactions as applicable in Pakistan, have been followed in
preparation of the financial statements and, any
In compliance with the Listed Companies (Code of departures therefrom (if any) have been adequately
Corporate Governance) Regulations, 2019 and applicable disclosed and explained.
laws & regulations, details of all related party transactions
are placed before the Audit Committee and upon
recommendations of the Audit Committee, the same are

2023 ANNUAL
REPORT 47
e) The system of internal control including financial
controls is sound in design and has been effectively Future Outlook and
implemented and monitored.
the Main Trends and
f) There are no doubts upon the Company’s ability to
continue as a going concern. Factors Likely to Affect
g) The Company operates an unfunded gratuity scheme the Future Development,
and does not hold any investment out of the scheme.
Performance and Position
h) The Company has not defaulted in repayment of any
debt nor is it likely to default in future. of the Company’s Business
We have included the following information separately, either The growth and profitability of the Company is dependent
in this report or in the financial statements as appropriate; upon a number of external factors such as economic
a) Detail of material changes or commitments which development, international raw material prices, political
have occurred between the end of financial year of the stability, consistent economic policies and law and order
Company to which the financial statements relate and situation of the Country. Going forward, the political and
the date of this report. economic situation in the Country will continue to affect
operations of the Company. Within the ferrous segment
b) Significant deviations from last year in operating results volumes are expected to remain at the current levels
of the Company and reasons for such deviations. whereas non-ferrous volumes are expected to increase.
c) Key operational and financial data for the last six years. However, in case of any boost in ferrous demand, the
Company is well positioned and geared up to cater the
d) Information regarding statutory payments on account of
anticipated increase. Finance cost will remain elevated
taxes, duties, levies and charges outstanding as at June
during FY 2024. The Company remains committed in
30, 2023.
improving efficiencies through technological advancement
e) Details of significant plans, decisions along with future and strengthening its supply chain. The key aspiration for the
prospects, risks and uncertainties surrounding the management in the years to come will not only to maintain
Company. the current performance standards but to add more feathers
f) Number of Board and committee meetings held during to the consistent track record of the Company.
the year and attendance by each Director.
g) The details of training program attended by Directors. Risk Management
h) Trading in shares of Company by Directors, executives Framework
and their spouses and minor children.
The Board of Directors has overall responsibility for
the establishment and oversight of the Company’s risk
management framework and for developing and monitoring
the Company’s risk management policies. While the risks
can be numerous, the principal risks faced by the Company
in financial year 2023 are described below along with the
corresponding response actions.
COMPETING
Risk Description of Risk Response to Risk
Political uncertainty Political situation of the country including changes in Government, regulations and
and instability impact business policies are monitored closely and appropriately to take timely decisions to
Political Risk
the business and its avoid / mitigate / address unfavorable impacts on the Company’s business.
profitability.
Economic conditions of Economic conditions are monitored appropriately to take timely decisions to avoid any
a country generally affect unfavorable impact on the Company’s business. Overall foreign currency exposure is
all businesses that exist closely monitored. Foreign currency risk is managed by limiting imports, shifting to local
in that country. Increase buying and increasing exports. Interest rate impact is managed by controlling working
in commodity prices, capital cycles.
Economic Risk
high interest costs, high
inflation, high exchange
rates, taxation and low
economic growth impact
organizations.
Technology plays a At Mughal steel we believe in process of balancing, modernization and replacements of
vital role in success of our production facilities, ensuring our production facilities are state of the art to ensure
any company. There cost minimization, energy efficiency and output optimization.
Technological
is risk that technology
Risk
employed is or may
become obsolete in the
near future.
Being in the industry for over 5 decades has enabled Mughal Steel to effectively
compete with existing companies in the industry. The following strengths of the
Company place it at a competitive advantage over its competitors:
1. Diversified product and market mix
Competition from 2. Global footprints
business competitors 3. Strong and well-established distribution network
may create a hostile
Competition Risk 4. Strong supply chain
environment for the
Company and result in 5. Backward integration
business loss.
6. Brand recognition
7. Economies of scale
8. Technological efficiencies
9. In-house electricity generation
Customers and banks Most of our sales are either against cash or advance. For credit sales, credit limits have
Credit Risk may default in payments been assigned to customers. Risk of default by banks has been mitigated by placement
to the company. of funds with banks having satisfactory credit ratings.
Insufficient cash The Company has a proactive cash management system. Committed credit lines from
available to pay liabilities banks are also available to bridge a liquidity gap, if any.
Liquidity Risk
resulting in a liquidity
problem.
Decrease in Decrease in the demand The Company has carefully developed its product portfolio which is diversified and risk
the demand for Company’s products averse.
for Company’s may have an adverse
products impact on its profitability.
The Company may not The Company has installed a gas-fired captive power plant and also has a dedicated
be able to operate at an 132 KVA grid station.
Energy Risk optimal capacity due
to the unavailability of
electricity.
With an experience of over 5 decades, the Company has developed a procurement
Adverse price movement
team who is well versed in acquiring the necessary raw material for production. Further,
Raw Material or no availability of raw
the Company has built strong relationship with its suppliers. In addition, due to export
Sourcing Risk materials may deter
operations the Company remains in good positions to import raw material, in addition to
smooth production.
sourcing raw material locally.
The Company is The Company has employed various professionals of respective fields so that the
regulated by a number of Company would strongly and strictly follow all the laws that are applicable to the
Laws & Government regulations Company.
Environmental which are required to be
regulations strictly followed. Default
in this regard can have
serious consequences.

2023 ANNUAL
REPORT 49
Uncertainties Facing Impact Of Company’s Business On Environment And
Environmental Protection Measures
the Company
Production of billets results in significant amount of smoke
The Company is mainly exposed to following uncertainties: which is released into the atmosphere. In order to control
this, the Company has installed state of the art dust collection
• Political uncertainty system. The dust collection system also accredits the Company
in fulfilling its strong commitment towards environmental
• Economic and operational uncertainties
sustainability. This has further strengthened the image of Mughal
• Fluctuations in foreign exchange rates Steel as an environmental sensitive Company that operates
• Fluctuations in interest rates in compliance to the international health and environmental
standards.
• Raw material availability
• Laws & regulations The Company is also ISO 14001:2015 compliant.
Key Sources of Uncertainty Community Investment & Welfare

Schemes
The preparation of financial statements in conformity with The Company has a tradition of good community relations. We
approved accounting standards, requires management to believe that investing in our communities is an integral part of
use certain accounting estimates and exercise judgements in our social commitment. Wedding ceremonies are arranged
the process of applying the Company’s accounting policies. for underprivileged individuals of the society. Educational
Estimates and judgements are regularly evaluated and are scholarships also are given to needy students who have shown
based on historical experience and various other factors that praiseworthy academic performance.
are believed to be reasonable under the circumstances. Actual
results may differ from these estimates. Revisions to accounting
estimates are recognized in the period in which the estimate is
Consumer Protection Measures
revised, if the revision affects only that period, or in the period The Company takes care and applies appropriate procedures
of revision and future periods, if the revision affects both current to manufacture steel products so as to ensure that no harmful
and future periods. substances are present in its products. The Company has policy
to control any activity which is against the consumer rights.
Corporate Social Industrial Relations

Responsibility The Company has set procedures, rules and regulations
which regulate employment guidance. The Company fully
The aim is to become a Company that is accepted by the
recognizes employee rights including the Collective Bargaining
society. Since, throughout our business process, we impact the
Agent (CBA). The Company is committed to provide equal
society in many ways, therefore we strive to be a good corporate
opportunity to all existing and prospective employees without
citizen and believe in giving back to the society.
any discrimination on the basis of religion, gender, race, age etc.
The Company also organizes rewards and recognition programs
Energy Conservation for acknowledgement of work done by its employees.
The Company is firmly committed to efficient use of limited
energy resources. In this regard, electricity can be produced Employment of Special Persons
at Mughal Steel. Further, successful turnaround in form of
The Company ensures employment of disabled persons in
new energy efficient furnaces and rolling mills have brought
compliance with the rules set out by the Government of Pakistan
desired results of efficient performance in addition to overall
in respect of quota of the total workforce necessitated to be
improvement in energy consumption indices.
allocated to disabled persons.
COMPETING
Occupational Health & Safety (OHS) 1. Installation of dust collection system for environment
protection.
We are firmly committed to maintaining a safe and healthy
working environment for our employees. Health management
2. Plantation is carried out to ensure a healthy and green
involves strengthening our employees’ physical, mental and
environment.
social well-being.
3. Keeping in view the occupational health of employees,
A free medical Centre has been established at site providing
regular first aid and CPR training programs are conducted
medical facilities to the employees. Keeping in view the
to ensure the safe health of workers.
occupational health of employees, regular first aid and CPR
training programs are conducted to ensure safe health of
Further, the Company is in compliance with ISO-14001:2015.
workers.
The Company is ISO 45001:2018 compliant. Energy Saving Measures Taken By The
Company And The Company’s Plans To
Business Ethics & Anticorruption Overcome The Escalating Energy Crisis
Measures At Mughal Steel our main priority is efficient use of limited energy
The Company ensures ethical compliance with all regulatory resources available. Successful operations of new energy
and governing bodies while conducting it’s operations. The efficient melting furnaces and re-rolling mills have contributed
Company has formulated various polices including “Code of towards efficient performance in addition to overall improvement
Conduct” and “Whistle Blowing Policy” and ensures effective in energy consumption. The Company has also installed system
implementation of these polices. Employees are encouraged to for generation of electricity from solar energy.
report any “kickbacks” deals. No employee is allowed to run a
parallel business.
Messages of The
National Cause Donations Chairman, Chief Executive
The Company encourages contributing to the national cause in Officer and Directors’
Statement of Compliance
the form of donations to Government Schemes.
Contribution To National Exchequer The Directors endorse the contents of the Chairman’s letter
During the year, the Company has contributed an amount of and review, Chief Executive Officer’s message and Directors’
Rs.10,806.528 million approx. towards national exchequer in statement of compliance.
shape of taxes, duties, cess, levies etc.
Rural Development Programs Acknowledgements

The Company encourages rural development programs for The Board expresses its gratitude for the efforts of all its
the enhancement of health of the rural population along with employees, executives, workers and stakeholders which
infrastructure development of the areas. enabled the management to run the Company smoothly
throughout the year. It is expected that the same co-operation
Mitigating Efforts To Control Industry would be forthcoming in future years. Lastly, we would like to
thank all stakeholders for their patronage and look forward to
Effluents their continued support.
In order to mitigate the effects of industrial effluents on the
surrounding environment, the Company is putting forth all efforts
for providing a healthy environment to employees and natives. On behalf of the Board,
In this regard following major environment friendly efforts have
been carried out by the Company:
Mirza Javed Iqbal Khurram Javaid

Chairman / Director Chief Executive Officer / Director

2023 ANNUAL
REPORT 51
10,806.528
COMPETING
2023 ANNUAL
REPORT 53
COMPETING
2023 ANNUAL
REPORT 55
COMPETING
2023 ANNUAL
REPORT 57
COMPETING
2023 ANNUAL
REPORT 59
03
FINANCIAL
HIGHLIGHTS
• Horizontal Analysis
• Vertical Analysis
• Summary of Statement of Cash Flows
• Financial Ratios
• Graphical Analysis
• Distribution of Wealth
• Results Reported in Interim Financial Statements and Final
Accounts
HORIZONTAL
ANALYSIS
2023 23 vs 22 2022 22 vs 21 2021 21 vs 20 2020 20 vs 19 2019 19 vs 18 2018 18 vs 17 2017

Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’
Satement of Financial Position
Total equity 25,372,435 21.71 20,847,078 26.48 16,504,860 102.33 8,157,574 8.71 7,503,934 0.50 7,466,333 12.49 6,637,098
Total non-current liabilities 7,867,435 12.60 6,987,054 8.75 6,404,989 86.22 3,439,460 (9.04) 3,781,257 136.34 1,599,956 148.81 643,053
Total current liabilities 26,592,117 5.31 25,251,327 33.67 18,889,958 34.84 14,009,074 23.36 11,355,819 35.05 8,408,467 (3.83) 8,743,576
Total equity & liabilities 59,831,987 39.62 53,085,459 27.02 41,799,806 63.24 25,606,108 13.10 22,641,009 29.56 17,474,757 9.06 16,023,727
Total non-current assets 19,810,891 19.83 16,532,562 4.25 15,859,024 59.13 9,965,806 15.51 8,627,828 35.99 6,344,432 48.42 4,274,764
Total current assets 40,021,096 9.49 36,552,897 40.93 25,940,782 65.86 15,640,302 11.61 14,013,181 25.90 11,130,324 (5.27) 11,748,963
Total assets 59,831,987 29.32 53,085,459 27.02 41,799,806 63.24 25,606,108 13.10 22,641,009 29.56 17,474,757 9.06 16,023,727
Statement of Profit or Loss
Sales-net 67,390,171 1.87 66,152,807 47.10 44,971,836 64.70 27,304,991 (11.43) 30,828,089 38.70 22,225,843 18.20 18,802,811
Less: cost of sales 57,719,143 3.02 56,024,920 46.35 38,280,468 55.06 24,687,543 (10.68) 27,639,095 42.24 19,431,431 15.41 16,837,364
Gross profit 9,671,028 4.89 10,127,888 51.36 6,691,368 155.64 2,617,449 (17.92) 3,188,994 14.12 2,794,412 42.18 1,965,447
Less:
Sales and marketing expenses 155,130 (36.84) 245,615 (3.42) 254,310 76.74 143,886 (28.63) 201,592 (18.16) 246,333 50.16 164,049
Administrative expenses 682,086 (3.24) 704,941 31.06 537,896 32.15 407,032 10.95 366,852 17.24 312,901 18.04 265,075
Other charges 353,845 (33.63) 533,108 40.46 379,246 609.53 53,450 (56.72) 123,487 8.62 113,690 24.32 91,451
Allowance for expected credit losses 34,445 2.89 33,476 (39.09) 54,959 1,537.15 3,357 1.42 3,310 100.00 1,664 - -
Add: other income (324,057) 51.87 (213,381) 219.31 (66,825) 13.67 (58,788) 95.97 (29,999) (17.50) (36,364) 7.03 (33,977)
901,449 (30.86) 1,303,759 12.40 1,159,586 111.24 548,936 (17.48) 665,242 4.23 638,223 31.16 486,598
Profit before interest & taxation 8,769,579 (0.62) 8,824,129 59.52 5,531,782 167.43 2,068,513 (18.04) 2,523,752 17.05 2,156,188 45.80 1,478,849
Less: finance costs 4,423,182 68.69 2,622,146 91.36 1,370,294 (9.54) 1,514,786 92.64 786,328 42.33 552,460 115.34 256,551
Profit before taxation 4,346,397 (29.92) 6,201,983 49.04 4,161,488 651.54 553,727 (68.13) 1,737,423 8.34 1,603,728 31.21 1,222,298
Less: taxation 865,912 9.47 791,024 4.11 732,338 (1,970.83) (39,145) (110.74) 364,492 16.26 313,513 35.40 231,538
Profit for the year 3,480,485 (35.68) 5,410,959 58.64 3,429,150 478.40 592,872 (56.82) 1,372,931 6.41 1,290,215 30.22 990,760
COMPETING
VERTICAL
ANALYSIS
2023 2022 2021 2020 2019 2018 2017

Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’
Statement of financial position
Total equity 25,372,435 42.41 20,847,078 39.32 16,504,860 39.49 8,157,574 31.86 7,503,934 33.14 7,466,333 42.73 6,637,098
Total non-current liabilities 7,867,435 13.15 6,987,054 13.12 6,404,989 15.32 3,439,460 13.43 3,781,257 16.70 1,599,956 9.16 643,053
Total current liabilities 26,592,117 44.44 25,251,327 47.56 18,889,958 45.19 14,009,074 54.71 11,355,819 50.16 8,408,467 48.12 8,743,576
Total equity & liabilities 59,831,987 100.00 53,085,459 100.00 41,799,807 100.00 25,606,108 100.00 22,641,010 100.00 17,474,756 100.00 16,023,727
Total non-current assets 19,810,891 33.11 16,532,562 31.14 15,859,024 37.94 9,965,806 38.92 8,627,828 38.11 6,344,432 36.31 4,274,764
Total current assets 40,021,096 66.89 36,552,897 68.86 25,940,782 62.06 15,640,302 61.08 14,013,181 61.89 11,130,324 63.69 11,748,963
Total assets 59,831,987 100.00 53,085,459 100.00 41,799,806 100.00 25,606,108 100.00 22,641,009 100.00 17,474,756 100.00 16,023,727
Statement of Profit or Loss
Sales-net 67,390,171 100.00 66,152,808 100.00 44,971,836 100.00 27,304,991 100.00 30,828,089 100.00 22,225,843 100.00 18,802,811
Less: cost of Sales 57,719,143 85.65 56,024,920 84.69 38,280,468 85.12 24,687,543 90.41 27,639,095 89.66 19,431,431 87.43 16,837,364
Gross profit 9,671,028 14.35 10,127,888 15.31 6,691,368 14.88 2,617,449 9.59 3,188,994 10.34 2,794,412 12.57 1,965,447
Sales and marketing expenses 155,130 0.23 245,615 0.37 254,310 0.57 143,886 0.53 201,592 0.65 246,333 1.11 164,049
Administrative expenses 682,086 1.01 704,941 1.07 537,896 1.20 407,032 1.49 366,852 1.19 312,901 1.41 265,075
Other charges 353,845 0.53 533,107 0.95 379,246 0.99 53,450 0.22 123,487 0.45 113,690 0.59 91,451
Allowance for expected credit losses 34,445 0.05 33,476 0.33 54,959 0.82 3,357 0.13 3,310 0.10 1,664 0.06 -
Add: other income (324,057) (0.48) (213,381) (0.32) (66,825) (0.15) (58,788) (0.22) (29,999) (0.10) (36,364) (0.16) (33,977)
901,449 1.34 1,303,758 1.97 1,159,586 2.58 548,937 2.01 665,242 2.16 638,224 2.87 486,598
Profit before interest & taxation 8,769,579 13.01 8,824,130 13.34 5,531,782 12.30 2,068,512 7.58 2,523,752 8.19 2,156,188 9.70 1,478,849
Less: finance costs 4,423,182 6.56 2,622,146 3.96 1,370,294 3.05 1,514,786 5.55 786,328 2.55 552,460 2.49 256,551
Profit before taxation 4,346,397 6.45 6,201,984 9.38 4,161,488 9.25 553,727 2.03 1,737,424 5.64 1,603,728 7.22 1,222,298
Less: taxation 865,912 1.28 791,024 1.15 732,338 1.63 (39,145) (0.14) 364,492 1.18 313,513 1.41 231,538
Profit for the year 3,480,485 5.16 5,410,960 8.22 3,429,150 7.63 592,872 2.17 1,372,931 4.45 1,290,215 5.81 990,760

2023 ANNUAL
REPORT 63
SUMMARY OF STATEMENT
OF CASH FLOWS
2023 2022
2021 2020 2019 2018 2017
Rs. in ‘000’ Rs. in ‘000’ Rs. in ‘000’ Rs. in ‘000’ Rs. in ‘000’ Rs. in ‘000’ Rs. in ‘000’
Cash flows generated from / (used in) operations 4,754,863 3,514,913 (3,770,313) 1,292,104 1,844,467 1,953,568 (756,354)
Net (increase) / decrease in long-term loans to employees 2,713 (12,089) (8,260) (1,373) 8,008 7,533 1,143
Net (increase) / decrease in long-term deposits (2,563) - (100) 1,685 (585) (2,587) -
Net (increase) / decrease in security deposit payable - - - - 400 - -
Defined benefits paid (31,588) (23,758) (13,748) (13,519) (7,076) (5,886) (5,504)
Workers’ profit participation fund paid (389,453) (223,496) (30,466) (73,986) (46,140) (65,304) (68,013)
Workers’ welfare fund paid (228,256) - - - (25,075) - -
Income tax paid (880,704) (776,564) (595,002) (885,451) (196,005) (437,312) (224,664)
Net cash flows generated from / (used in) operating activities 3,225,012 2,479,007 (4,417,888) 319,460 1,577,994 1,450,012 (1,053,393)
Payments for acquisition of property, plant and equipment (1,738,305) (1,696,277) (1,289,777) (1,554,198) (2,435,378) (2,205,110) (473,866)
Payments for long term investemnt in financial assets (50,153)
Proceeds from disposal of tangible fixed assets 72,615 34,924 11,472 45,881 5,975 2,159 2,641
Net proceeds from sale of assets classified as held for sale - 489,744 -
Profit received on term deposit receipts 49,381 584 15,685 38,776 5,645 23,109 18,813
Net cash generated from / (used in) investing activities (1,666,462) (1,171,025) (1,262,620) (1,469,541) (2,423,758) (2,179,843) (452,412)
Long-term financing - net proceeds (341,094) 610,926 1,215,848 135,403 2,510,954 797,287 (407,496)
Finance cost paid (3,859,933) (2,493,734) (1,679,267) (1,480,422) (566,504) (517,684) (219,433)
Net proceeds from deferred grant - - 44,981 - - - -
Net proceeds from short-term loans 388,283 4,499,046 4,000,887 2,074,240 1,263,797 (473,618) 3,442,287
Proceeds from issuance of ordinary shares (19,375) 21,869 2,737,404 - - - 1,257,998
Transaction costs relating to issue of ordinary shares - - (11,523) - - - (12,340)
Dividends paid (969) (1,005,527) (752,453) (301,270) (551,160) (163,784) (613,166)
Net cash generated from / (used in) financing activities (3,833,088) 1,632,580 5,555,877 427,951 2,657,087 (357,799) 3,447,851
Net increase / (decrease) in cash and cash equivalents (2,274,538) 2,940,562 (124,632) (722,130) 1,811,322 (1,087,629) 1,942,046
Cash and cash equivalents at the beginning of the year 5,163,452 2,216,929 2,340,364 3,062,494 1,251,171 2,338,801 396,755
Net foreign exchange difference (3,787) 5961.674 1,197 - - - -
Cash and cash equivalents at the end of the year 2,885,126 5,163,452 2,216,929 2,340,364 3,062,494 1,251,171 2,338,801
COMPETING
FINANCIAL RATIOS
Ratio Description 2023 2022 2021 2020 2019 2018 2017
Profitability Ratios
Gross profit ratio 14.35% 15.31% 14.88% 9.59% 10.34% 12.57% 10.45%
Net profit to sales ratio 5.16% 8.18% 7.63% 2.17% 4.45% 5.81% 5.27%
EBITDA margin to sales 13.69% 14.01% 12.95% 8.24% 8.68% 10.31% 8.55%
Return on equity 13.72% 25.96% 20.78% 7.27% 18.30% 17.28% 14.93%

Liquidity Ratios
Current ratio 1.50 1.45 1.37 1.12 1.23 1.32 1.34
Quick / Acid test ratio 0.64 0.54 0.59 0.54 0.74 0.62 0.68
Cash / current liabilities 0.11 0.20 0.12 0.17 0.28 0.15 0.27

Activity / Turnover Ratios
Inventory turnover ratio 2.80 3.27 3.84 4.34 5.54 3.63 3.51
No. of days in Inventory 130 111 95 84 66 101 104
Debtor turnover ratio 9.07 12.25 12.09 9.95 13.50 10.70 8.02
No. of days in Receivables 40 30 30 37 27 34 46
Creditor turnover ratio 4.20 6.16 5.01 4.20 4.43 3.13 3.19
No. of days in payables 87 59 73 87 82 117 114
Total Assets turnover ratio 1.13 1.25 1.08 1.07 1.36 1.27 1.17
Fixed assets turnover ratio 3.69 4.02 3.05 5.61 6.26 5.08 4.85

Investment / Market Ratios
Earnings per share 10.39 16.12 12.85 2.25 5.46 5.13 4.21
Price earnings ratio 4.74 4.09 8.12 16.90 4.61 12.20 19.18
Cash dividend per share 3.20 3.00 3.00 - 1.20 2.20 2.60
Stock dividend per share - - 15.00 - - - -
Break up value per share 75.61 62.11 56.55 32.42 29.82 29.68 26.38

Capital structure ratios
Financial leverage ratio 1.02 1.24 1.26 1.85 1.78 1.16 1.21
Weighted average cost of debt 17.0% 11.22% 8.55% 12.31% 9.34% 6.15% 4.02%
Long term debt to equity ratio 0.20 0.25 0.28 0.42 0.45 0.11 -
Interest cover ratio 1.96 3.34 3.58 1.11 2.57 4.18 6.27

2023 ANNUAL
REPORT 65
GRAPHICAL
ANALYSIS
Profitability Ratios Liquidity Ratios
Percentage Times
16.00% 1.60
14.00% 1.40
12.00% 1.20
10.00% 1.00
8.00% 0.80
6.00% 0.60
4.00% 0.40
2.00% 0.20
0.00% 0.0
2023 2022 2021 2020 2019 2018 2017 2023 2022 2021 2020 2019 2018 2017
Gross Profit Ratio Profit Before Tax to Sales Current Ratio Quick / Acid Test Ratio
EBITDA Margin To Sales Cash To Current Liabilities
25.00%
Turnover Ratios Market Ratios

Times Rupees / Times
120
14.00
12.00 100
10.00 80
8.00 60
6.00
40
4.00
20
2.00
0.00 0
2023 2022 2021 2020 2019 2018 2017 2023 2022 2021 2020 2019 2018 2017
Inventory Turnover Ratio Debtor Turnover Ratio Earnings Per Share Price Earnings Ratio
Total Assets Turnover Ratio Creditor Turnover Ratio Market value per share Break Up Value Per Share
Capital Structure Ratio Return On Equity

Times / Percent Percentage
7.00 30
6.00 25
5.00
20
4.00
15
3.00
10
2.00
5
1.00
0.00 0
2023 2022 2021 2020 2019 2018 2017 2023 2022 2021 2020 2019 2018 2017
Financial Leverage Ratio Weighted Average Cost of Debt Interest Cover Ratio Return On Equity
Horizontal Analysis - Statement Of Financial Position Horizontal Analysis - Statement of Profit or Loss
Rupees in thousands Rupees in thousands
50,000,000
80,000,000
70,000,000
40,000,000
60,000,000
30,000,000 50,000,000
40,000,000
20,000,000 30,000,000
20,000,000
10,000,000
10,000,000
0
0 2023 2022 2021 2020 2019 2018 2017
2023 2022 2021 2020 2019 2018 2017
Equity Non Current Liabilities Current Liabilities Sales Gross Profit Profit From operation
Non Current Assets Current Assets Finance Costs Profit Before Tax Profit For The Year
COMPETING
Equity & Liabilities Assets
Rupees in thousands Rupees in thousands
30,000,000 50,000,000
25,000,000 40,000,000
20,000,000
30,000,000
15,000,000
20,000,000
10,000,000
10,000,000
5,000,000
0 0
2023 2022 2021 2020 2019 2018 2017 2023 2022 2021 2020 2019 2018 2017
Current liabilities Equity Current assets Non Current assets
Non Current liabilities
Equity & Liabilities - 2023 Equity & Liabilities - 2022
45% Current Liabilities 48% Current Liabilities
42% Equity 39% Equity
13% Non Current Liabilities 26% Non Current Liabilities
Assets - 2023 Assets - 2022
67% Current Assets 69% Current Assets
33% Non Current Assets 31% Non Current Assets
Profit or Loss - 2023 Profit or Loss - 2022
90% Cost of Sales 92% Cost of Sales
1% Sales and Marketing Expenses 1% Sales and Marketing Expenses
1% Administrative Expenses 1% Administrative Expenses
1% Other Charges 1% Other Charges
1% Impairment 1% Impairment
4% Finance Cost 4% Finance Cost
1% Taxation 1% Taxation

2023 ANNUAL
REPORT 67
DISTRIBUTION
OF WEALTH
2023 2022
Rs. In ‘000’ % Rs. In ‘000’ %
Wealth generated
Sales 67,390,171 66,152,807
Less: Cost of sales (excluding employees’ remuneration) 56,400,869 54,906,852
Value added 10,989,302 11,245,955
Other operating income 324,057 213,381
11,313,359 100.00 11,459,336 100.00
Distribution of wealth
Distribution, administrative & other expenses 658,596 6% 450,924 4%
To Directors & employees as remuneration 1,885,185 17% 1,725,971 15%
To Government as taxes 865,912 8% 791,024 7%
To providers of finance as financial charges 4,423,182 39% 2,622,146 23%
To shareholders as cash dividend 1,074,029 9% 1,006,901 9%
Retained in business 2,406,455 21% 4,862,370 42%
11,313,359 100.00 11,459,336 100.00
Wealth Distribution
Rupees in thousands
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
Distribution, To Directors & To Government To providers of To shareholders as Retained in
administrative employees as taxes finance interim cash business
& other as remuneration as financial dividend
charges
2023 2022
COMPETING
RESULTS REPORTED IN INTERIM
FINANCIAL STATEMENTS AND FINAL
ACCOUNTS
RESULTS REPORTED IN INTERIM

FINANCIAL STATEMENTS AND FINAL
ACCOUNTS
Interim Results Annual Results

September Quarter - 22 December Quarter - 22 March Quarter - 23 Financial year - 23
Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ % Rs. in ‘000’ %
Turnover 14,073,292 17,167,345 17,238,679 67,390,171
Gross profit 2,084,440 14.81% 1,277,242 7.44% 3,252,640 18.87% 9,671,028 14.35%
Profit before tax 1,031,218 7.33% 43,816 0.26% 1,904,602 11.05% 4,346,397 6.45%
Taxation 159,700 1.13% 427,234 2.49% 599,671 3.48% 861,912 0.01
Net profit after tax 871,518 6.19% 471,050 2.74% 1,304,931 7.57% 3,480,484 5.17%
36,423,542 38,758,360 38,107,240 40,021,097
Current ratio 1.47 1.42 1.53 1.50
24,786,580 27,305,082 24,939,184 26,592,117
Analysis of variation in results reported in interim

financial statements with the final accounts
Quarter on quarter variations in topline and gross profit are mainly cyclical in nature. Mis-match between average inventory
costs and prevailing sale prices effects gross margins in different individual quarters. Taxation decreased in second quarter
due to recognition of prior year tax reversal, and increased in last quarter due to increase in turnover and increase in effective
tax rate for deferred tax.

2023 ANNUAL
REPORT 69
04
FINANCIAL
STATEMENTS
• Shariah Review Report
• Independent Assurance Report on Compliance with the Shariah
Governance Regulations, 2023
• Statement of Compliance With Sukuk and Islamic Commercial Paper (ICP)
Features and Shariah Requirements
• Independent Auditors’ Review Report To The Members
• Statement of Compliance With Listed Companies (Code Of Corporate
Governance) Regulations, 2019
• Independent Auditors’ Report To The Members
• Statement of Financial Position
• Statement Of Profit Or Loss & Other Comprehensive Income
• Statement of Changes In Equity
• Statement of Cash Flows
• Notes To And Forming Part of The Financial Statements
72
INDEPENDENT ASSURANCE REPORT ON COMPLIANCE
WITH THE SHARIAH GOVERNANCE REGULATIONS,
2023
TO THE BOARD OF DIRECTORS OF MUGHAL IRON & STEEL INDUSTRIES LIMITED (THE
COMPANY), ISSUER OF SHARIAH COMPLIANT SECURITIES.
1. Introduction
We have undertaken a reasonable assurance engagement that the Securities and Exchange Commission of Pakistan (SECP)
has required in terms of its Shariah Governance Regulations, 2023 (the Regulations) – External Shariah Audit of the Company for
assessing compliance of the Company’s financial arrangements, contracts, and transactions in respect of Shariah Compliant
Securities issued, having Shariah implications with Shariah principles for the year ended June 30, 2023. This engagement was
conducted by a multidisciplinary team including assurance practitioners and independent Shariah scholar(s).
2. Applicable Criteria
The criteria for the assurance engagement, against which the underlying subject matter (financial arrangements, contracts, and
transactions having Shariah implications for the year ended June 30, 2023) is assessed, comprise of the Shariah principles and
rules, as defined in the Regulations and reproduced as under:
Shariah principles and rules means requirements, standards, rulings or permissions, pertaining to Islamic financial services,
derived from the following: -
i) Legal and regulatory framework administered by the Commission;
ii) Shariah standards issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), as
notified by Commission;
iii) Islamic Financial Accounting Standards, developed by the Institute of Chartered Accountants of
Pakistan, as notified by the Commission;
iv) Guidance and recommendations of the Shariah advisory committee, as notified by Commission; and
v) Approvals, rulings or pronouncements of the Shariah supervisory board or the Shariah advisor of the Islamic financial
institution, in line with (i) to (iv) above.
The above criteria were evaluated for their implications on the financial statements of the Company for the year ended June 30,
2023, which are annexed.
3. Management’s Responsibility for Shariah Compliance

Management is responsible to ensure that the financial arrangements, contracts and transactions having Shariah implications,
entered into by the Company with its customers, other financial institutions and stakeholders and related policies and procedures
are, in substance and in their legal form, in compliance with the requirements of Shariah rules and principles. The management
is also responsible for design, implementation and maintenance of appropriate internal control procedures with respect to such
compliance and maintenance of relevant accounting records.
4. Our Independence and Quality Control

We have complied with the independence and other ethical requirements of the Code of Ethics for Chartered Accountants
issued by the Institute of Chartered Accountants of Pakistan, which is founded on fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality and professional behavior.
The firms apply International Standard on Quality Control 1 “Quality Control for Firms That Perform Audits and Reviews of
Historical Financial Information, And Other Assurance and Related Services Engagements” and accordingly maintain a
comprehensive system of quality control including documented policies and procedures regarding compliance with ethical
requirements, professional standards and applicable legal and regulatory requirements.
73
5. Our responsibility and summary of the work performed
Our responsibility in connection with this engagement is to express an opinion on compliance of the Company’s financial
arrangements, contracts, and transactions having Shariah implications with Shariah principles, in all material respects, for the
year ended June 30, 2023 based on the evidence we have obtained. We conducted our reasonable assurance engagement
in accordance with International Standard on Assurance Engagements 3000, ‘Assurance Engagements other than audits or
reviews of historical financial statements’, issued by the International Auditing and Assurance Standards Board. That standard
requires that we plan and perform this engagement to obtain reasonable assurance about whether the compliance of the
Company’s financial arrangements, contracts, and transactions having Shariah implications with Shariah principles is free from
material misstatement.
The procedures selected by us for the engagement depended on our judgement, including the assessment of the risks of
material non-compliance with the Shariah principles. In making those risk assessments, we considered and tested the internal
control relevant to the Company’s compliance with the Shariah principles in order to design procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. We
have designed and performed necessary verification procedures on various financial arrangements, contracts and transactions
having Shariah implications and related policies and procedures based on judgmental and systematic samples with regard to
the compliance of Shariah principles (criteria specified in para 2 above).
We believe that the evidences we have obtained through performing our procedures were sufficient and appropriate to provide
a basis for our opinion.
6. Conclusion
Based on our reasonable assurance engagement, we report that in our opinion, the Company’s financial arrangements, contracts
and transactions in respect of Shariah Compliant Securities issued, for the year ended June 30, 2023 are in compliance with the
Shariah principles (criteria specified in the paragraph 2 above), in all material respects.
Fazal Mahmood & Company Muniff Ziauddin & Company

Chartered Accountants Chartered Accountants
(Member firm of PrimeGlobal International) (A member of BKR International)
Lahore Lahore
Date: September 22, 2023 Date: September 22, 2023
74
STATEMENT OF COMPLIANCE WITH SUKUK AND
ISLAMIC COMMERCIAL PAPER (ICP)
FEATURES AND SHARIAH REQUIREMENTS
Name of company: Mughal Iron & Steel Industries Limited (the Company)
Year ended: June 30, 2023
Securities: Shariah Compliant Sukuk Certificates
Shariah Compliant Islamic Commercial Paper (ICP)
We confirm that:
The financial arrangements, contracts and transactions entered into by the Company in respect of issue of Sukuk and
Islamic Commercial Paper (ICP) were in accordance with the Sukuk and Islamic Commercial Paper (ICP) features and
Shariah requirements.
We further confirm that:

• The Company has established policies and procedures for all Sukuk and Islamic Commercial Paper (ICP) related
transactions to comply with the Sukuk and Islamic Commercial Paper (ICP) Features and Shariah Requirements.
• The Company has implemented and maintained such internal control and risk management systems that are necessary
to mitigate the risk of non-compliances with the Sukuk and Islamic Commercial Paper (ICP) Features and Shariah
requirements, whether due to fraud or error.
• The Company has a process to ensure that the management and where appropriate the Board of Directors, and
personnel responsible to ensure the Company’s compliance with the Sukuk and Islamic Commercial Paper (ICP)
Features and Shariah Requirements are properly trained and systems are properly updated.
The Sukuk and Islamic Commercial Paper (ICP) features and Shariah requirements shall mean the following:
• Shariah principles in the light of the rules, regulations and directives issued by the Securities and Exchange Commission
of Pakistan (SECP);
• Requirements of the Fatwa (Shariah pronouncement);
• Requirements as per the underlying transaction documents;
• Requirements of Shariah Governance Regulations, 2023;
• Shariah Standards issued by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), as
adopted by the SECP, if any; and
• Requirements of the applicable Islamic Financial Accounting Standards as notified by the SECP.

Chairman / Director Chief Executive Officer / Director
75
INDEPENDENT AUDITORS’ REVIEW REPORT TO THE
MEMBERS OF MUGHAL IRON & STEEL INDUSTRIES
LIMITED
REVIEW REPORT ON THE STATEMENT OF COMPLIANCE CONTAINED IN LISTED
COMPANIES (CODE OF CORPORATE GOVERNANCE) REGULATIONS, 2019
We have reviewed the enclosed Statement of Compliance with the Listed Companies (Code of Corporate Governance)
Regulations, 2019 (the Regulations) prepared by the Board of Directors of Mughal Iron & Steel Industries Limited (the Company)
for the year ended June 30, 2023 in accordance with the requirements of regulation 36 of the Regulations.
The responsibility for compliance with the Regulations is that of the Board of Directors of the Company. Our responsibility is
to review whether the Statement of Compliance reflects the status of the Company’s compliance with the provisions of the
Regulations and report if it does not and to highlight any non-compliance with the requirements of the Regulations. A review is
limited primarily to inquiries of the Company’s personnel and review of various 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 required to consider whether
the Board of Directors’ statement 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 procedures 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 transactions. We are only required and have
ensured compliance of this requirement to the extent of the approval of the related party transactions by the Board of Directors
upon recommendation of the Audit Committee.
Based on our review nothing has come to our attention which causes us to believe that the Statement of Compliance does not
appropriately reflect the Company’s compliance, in all material respects, with the requirements contained in the Regulations as
applicable to the Company for the year ended June 30, 2023.

Lahore Lahore
UDIN: CR202310155c239bfHJX UDIN: CR202310123MYev5k6a3
76
STATEMENT OF COMPLIANCE WITH LISTED
COMPANIES (CODE OF CORPORATE GOVERNANCE)
REGULATIONS, 2019 (THE REGULATIONS)
Name of company: Mughal Iron & Steel Industries Limited
Year ended: June 30, 2023
The Company has complied with the requirements of the Regulations in the following manner:
1. The total number of Directors are 9 as per the following;

a. Male 8
b. Female 1
2. The composition of Board is as follows:
a. Independent Directors Mr. Abdul Rehman Qureshi

Mr. Shoaib Ahmed Khan
Ms. Mariam Khawar
b. Non-Executive Directors Mr. Mirza Javed Iqbal

Mr. Muhammad Mateen Jamshed
c. Executive Directors Mr. Khurram Javaid

Mr. Muhammad Mubeen Tariq Mughal
Mr. Jamshed Iqbal
d. Female Directors Ms. Mariam Khawar
3. The Directors have confirmed that none of them is serving as a Director on more than seven listed companies, including
this Company;
4. The Company has prepared a Code of Conduct and has ensured that appropriate steps have been taken to disseminate
it throughout the Company along with its supporting policies and procedures;
5. The Board has developed a vision/mission statement, overall corporate strategy and significant policies of the Company.
The Board has ensured that complete record of particulars of the significant policies along with their date of approval or
updating is maintained by the Company;
6. All the powers of the Board have been duly exercised and decisions on relevant matters have been taken by the Board/
shareholders as empowered by the relevant provisions of the Act and these Regulations;
7. The meetings of the Board were presided over by the Chairman and, in his absence, by a Director elected by the Board
for this purpose. The Board has complied with the requirements of Act and the Regulations with respect to frequency,
recording and circulating minutes of meetings of the Board;
8. The Board of Directors have a formal policy and transparent procedures for remuneration of Directors in accordance with
the Act and these Regulations;
9. 7 of the Directors have completed the Director’s Training Program certification from authorized institutions and 1 of the
Director has obtained exemption due to having the prescribed qualification and experience pursuant to Regulation 19 of
the Regulations. Remaining 1 Director will also complete Director’s Training Program in near future;
77
10. The Board has approved appointment of Chief Financial Officer, Company Secretary and Head of Internal Audit, including
their remuneration and terms and conditions of employment and complied with relevant requirements of the Regulations;
11. Chief Financial Officer and Chief Executive Officer duly endorsed the financial statements before approval of the Board;
12. The Board has formed committees comprising of members given below;
Audit Committee Mr. Abdul Rehman Qureshi - Chairman

Mr. Fazeel Bin Tariq – Member Mr. Muhammad Mateen Jamshed – Member

HR and Remuneration Committee Mr. Abdul Rehman Qureshi – Chairman
Mr. Mirza Javed Iqbal – Member
Mr. Fazeel Bin Tariq – Member
Currently, the Board has not constituted separate Nomination Committee and Risk Management Committee as its issues
are deliberated in Board meetings.
13. The terms of reference of the aforesaid committees have been formed, documented and advised to the committees for
compliance;
14. The frequency of meetings of the committees were as per following;
a. Audit Committee Four quarterly meetings

b. HR and Remuneration Committee Two meetings
15. The Board has set up an effective in-house internal audit function which is considered suitably qualified and experienced
for the purpose and is conversant with the policies and procedures of the Company;
16. The statutory auditors of the Company have confirmed that they have been given a satisfactory rating under the Quality
Control Review program of the Institute of Chartered Accountants of Pakistan and registered with Audit Oversight Board
of Pakistan, that they and all their partners are in compliance with International Federation of Accountants (IFAC) guidelines
on code of ethics as adopted by the Institute of Chartered Accountants of Pakistan and that they and the partners of the
firm involved in the audit are not a close relative (spouse, parent, dependent and non-dependent children) of the Chief
Executive Officer, Chief Financial Officer, Head of Internal Audit, Company Secretary or Director of the Company;
17. The statutory auditors or the persons associated with them have not been appointed to provide other services except in
accordance with the Act, these regulations or any other regulatory requirement and the auditors have confirmed that they
have observed IFAC guidelines in this regard;
18. We confirm that all requirements of regulations 3, 6, 7, 8, 27, 32, 33 and 36 of the Regulations have been complied with;

Chairman / Director Chief Executive Officer /Director
78
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS
OF MUGHAL IRON & STEEL INDUSTRIES LIMITED
REPORT ON THE AUDIT OF FINANCIAL STATEMENTS
Opinion
We have audited the annexed financial statements of MUGHAL IRON & STEEL INDUSTRIES LIMITED (the Company), which comprise the
statement of financial position as at June 30, 2023 and the statement of profit or loss and other comprehensive income, the statement of
changes in equity and statement of cash flows for the year then ended, and notes to 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 financial position, the statement
of profit or loss and other 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 June 30, 2023 and of the profit and 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 the International Standards on Auditing (ISAs) as applicable in Pakistan. Our responsibilities under
those standards are further described in the Auditors’ 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 matters.
Following are the Key Audit Matters:
S. No. Key Audit Matters How the Matter Was Addressed in Our Audit
1 Revenue Recognition Our Audit Procedures Included the Following:
(Refer to note 4.7 and 33 to the financial statements) • Obtained understanding of the Company’s processes and
related internal controls for revenue recognition and on a
The Company is engaged in the manufacturing and sale of
sample basis, tested the operating effectiveness of those
products relating to ferrous and non-ferrous segments.
controls;
Revenue from the sale of goods is recognized as or when
• Assessed the appropriateness of the Company’s revenue
performance obligations are satisfied by transferring control
accounting policies in accordance with the applicable
of promised goods to customers, and control is transferred
financial reporting framework;
at a point in time. Revenue is measured at fair value of
consideration received or receivable, excluding discounts • Performed testing of revenue transactions on a sample
and the payment is due on the satisfaction of performance basis with underlying documentation including dispatch
obligation. documents and sales invoices;
We considered revenue recognition as a key audit matter due • Performed audit procedures to analyze variation in the price
to revenue being one of the key performance indicators of and quantity sold during the year;
the Company. In addition, revenue was also considered as
• Performed cut-off procedures on near year-end sales to
an area of significant audit risk as part of the audit process
ensure revenue has been recorded in the correct period; and
as it includes a large number of transactions and customers
spread in various geographical locations. • Considered the adequacy of the related disclosures
and assessed whether these are in accordance with the
applicable financial reporting standards and the Companies
Act, 2017 (XIX 2017).
2 Existence and Valuation of Inventories Our Audit Procedures Included the Following:
As disclosed in note 11 to the accompanying financial • Our audit procedures, amongst others, included obtaining
statements, the inventories balance constitutes 38% of total an understanding of controls over purchases and valuation
assets of the Company. This comprise of stores, spares of inventories and tested, on a sample basis, their design,
and loose tools, raw material and finished goods and waste implementation and operating effectiveness;
inventory.
79
S. No. Key Audit Matters How the Matter Was Addressed in Our Audit
We have identified existence and valuation of inventories as a • We performed observation of inventory counts for stores,
key audit matter as it forms a significant portion of Company’s spares and loose tools, raw material and finished goods
total assets. and waste inventories and additionally involved an external
expert to perform physical inspection of scrap inventory held
at company’s premises; and
• We assessed net realizable value (NRV) by comparing
management’s estimation of future selling prices for the
products with the selling prices achieved subsequent to the
reporting period. We also compared the NRV of inventories
on a sample basis, to the cost of finished goods to assess
whether any adjustments are required to value inventory
in accordance with applicable accounting and reporting
standards.
3 The Company’s Exposure to Litigation Risk Our Audit Procedures Included the Following:
(Refer to note 15 and 32 to the financial statements) • Obtaining understanding of the Company’s processes
and controls over litigations through meetings with the
The Company is exposed to different laws, regulations and
management and review of the minutes of the Board of
interpretations thereof and hence, there is a litigation risk.
Directors and Audit Committee;
Consequently, the Company has significant litigation cases
• A review of the correspondence of the Company with
pending with Custom Authorities, Federal Board of Revenue
the relevant regulatory authorities and tax/legal advisors
and Punjab Revenue Authority.
including judgments or orders passed by the competent
Given the nature and amounts involved in such cases and authorities;
the appellate forums at which these are pending, the ultimate
• Discussing open matters and developments with the in-
outcome and the resultant accounting in the financial
house tax/legal department personnel of the Company;
statements is subject to significant judgement, which can
change over time as new facts emerge and each legal case • We also obtained and reviewed confirmations from the
progresses, and therefore, we have identified this as key audit Company’s external tax and legal advisors for their views on
matter. the status of each case and an overall opinion on the open
tax and legal position of the Company; and
• Whilst noting the inherent uncertainties involved with the
legal and regulatory matters, assessing the appropriateness
of the related disclosures made in the annexed financial
statements.
Information Other than the Financial Statements and Auditors’ 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 auditors’ report thereon.
Our opinion on the 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 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 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 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 the Companies Act, 2017 (XIX of 2017) and for such internal control as
management determines is necessary to enable the preparation of the 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.
Auditors’ 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 auditors’ 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
80
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 maintain 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, 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 Company’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 obtained up to the date of our auditors’ 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 significance in the audit of the
financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditors’ 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.
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 and other 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) no zakat was dedutible at source under the zakat and Ushr Ordinance, 1980 (XVIII of 1980).
Other Matter
The financial statements of the Company for the year ended June 30, 2022 were audited by M/s. Fazal Mahmood & Company, Chartered
Accountants, whose audit report dated September 20, 2022 expressed an unmodified opinion on the aforementioned financial statements.
The engagement partners on the audit resulting in this independent auditors’ report are Fazal Mahmood and Arqum Naveed.

Lahore Lahore
UDIN: AR202310155Y1SHg4TkV UDIN: AR2023101237OSL5gEd3
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STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2023
Rupees Note 2023 2022
ASSETS
NON - CURRENT ASSETS
Property, plant and equipment 6. 19,691,989,633 16,460,726,021
Intangible asset 7. – 721,651
Long-term investment in financial assets 8. 50,153,187 –
Long-term loans to employees 9. 65,909,792 51,269,414
Long-term deposits 10. 2,838,069 19,845,317
19,810,890,681 16,532,562,403
CURRENT ASSETS
Inventories 11. 23,030,260,466 22,962,971,000
Trade debts 12. 9,283,146,446 5,573,585,633
Loans and advances 13. 431,390,565 148,276,956
Deposits, prepayments and other receivables 14. 629,520,459 189,758,304
Due from the government 15. 3,761,651,991 2,502,670,861
Cash and bank balances 16. 2,885,126,870 5,175,634,586
40,021,096,797 36,552,897,340
Assets classified as held for sale 17. – –
59,831,987,478 53,085,459,743
EQUITY AND LIABILITIES

SHARE CAPITAL & RESERVES
Authorized share capital 18. 5,000,000,000 5,000,000,000
Issued, subscribed and paid-up capital 19. 3,356,339,330 3,356,339,330
Capital reserves:
Share premium account 20. 2,324,952,020 2,324,952,020
Contingency reserve 21. 980,000,000 980,000,000
Revaluation surplus on property, plant and equipment 22. 3,998,378,178 3,018,133,793
Revenue reserve:
Un-appropriated profits 14,712,766,418 11,167,653,096
25,372,435,946 20,847,078,239
LIABILITIES
NON - CURRENT LIABILITIES
Long-term financing - secured 23. 3,302,066,679 4,027,845,474
Deferred taxation 24. 3,879,094,946 2,415,979,740
Defined benefit obligation 25. 601,259,811 467,898,836
Deferred liabilities 26. 85,013,360 75,330,101
7,867,434,796 6,987,054,151
CURRENT LIABILITIES
Trade and other payables 27. 3,006,477,394 2,923,689,503
Unclaimed dividends 28. 2,956,938 2,963,664
Unpaid dividends 28. 6,105,932 7,068,715
Accrued profit / interest / mark-up 29. 889,758,212 379,869,093
Short-term borrowings 30. 20,995,046,293 20,618,945,517
Short-term loans from Directors - unsecured 31. 5,689,036 25,062,812
Current portion of long-term financing 23. 1,678,411,215 1,281,336,412
Current portion of deferred grant 7,671,716 12,391,637
26,592,116,736 25,251,327,353
34,459,551,532 32,238,381,504
59,831,987,478 53,085,459,743
CONTINGENCIES AND COMMITMENTS 32

The annexed notes from 1 to 55 form an integral part of these financial statements.
Khurram Javaid Muhammad Zafar Iqbal Muhammad Mubeen Tariq Mughal

Chief Executive Officer / Director Chief Financial Officer Director
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STATEMENT OF PROFIT OR LOSS &
OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED JUNE 30, 2023
Sales - net 33. 67,390,170,763 66,152,807,655

Cost of sales 34. (57,719,142,873) (56,024,920,076)
GROSS PROFIT 9,671,027,890 10,127,887,579
Sales and marketing expenses 35. (155,129,806) (245,614,961)

Administrative expenses 36. (682,086,170) (704,940,843)
Other charges 37. (353,845,442) (533,107,437)
Allowance for expected credit losses 12. (34,444,853) (33,476,039)
Other income 38. 324,057,598 213,380,851
Finance cost 39. (4,423,182,001) (2,622,145,797)
(5,324,630,674) (3,925,904,226)
PROFIT BEFORE TAXATION 4,346,397,216 6,201,983,353
Taxation 40. (865,912,425) (791,024,212)
PROFIT FOR THE YEAR 3,480,484,791 5,410,959,141
OTHER COMPREHENSIVE INCOME / LOSS

Items that will not be reclassified subsequently to profit or loss:
- Remeasurement gain / loss on defined benefit obligation 4,363,993 (11,221,594)
- Related deferred tax (1,701,957) 3,254,262
2,662,036 (7,967,332)
- Impairment loss recognized on reclassification from property,
plant and equipment to assets classified as held for sale – (75,875,141)
- Related deferred tax – 22,003,791
– (53,871,350)
- Revaluation surplus on property, plant and equipment 1,971,478,562 –
- Related deferred tax (575,188,857) –
1,396,289,705 –
Other comprehensive income / loss - net of tax 1,398,951,741 (61,838,682)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 4,879,436,532 5,349,120,459
EARNINGS PER SHARE - BASIC AND DILUTED 41. 10.37 16.12

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STATEMENT OF CHANGES IN EQUITY
Rupees Capital reserves Revenue reserve

Share Contingency Revaluation surplus Un-appropriated Issued, subscribed Total
premium reserve on property, plant profits and paid-up capital Equity

account and equipment
BALANCE AS AT JUNE 30, 2021 2,918,555,940 2,762,735,410 980,000,000 3,402,244,904 6,441,323,325 16,504,859,579
Profit for the year – – – – 5,410,959,141 5,410,959,141
Other comprehensive loss – net of tax – – – (53,871,350) (7,967,332) (61,838,682)
Total comprehensive income for the year – – – (53,871,350) 5,402,991,809 5,349,120,459
Transfer of Incremental depreciation relating to revaluation

surplus on property, plant and equipment – net of tax – – – (78,235,645) 78,235,645 –
Revaluation surplus on property, plant & equipment realized

on sale of non – current assets classified as held for sale – net of tax – – – (252,004,116) 252,004,116 –
Transaction with owners

Issue of 43,778,339 ordinary shares of Rs. 10/– each
as fully paid – up bonus shares @ 15% 437,783,390 (437,783,390) – – – –
Interim cash dividend for the year ending June 30, 2022
@ Rs. 3.00 per ordinary share i.e. 30% – – – – (1,006,901,799) (1,006,901,799)
Profit for the year – – – – 3,480,484,791 3,480,484,791

Other comprehensive income – net of tax – – – 1,396,289,705 2,662,036 1,398,951,741
Total comprehensive income for the year – – – 1,396,289,705 3,483,146,827 4,879,436,532
Transfer of Incremental depreciation relating to revaluation

surplus on property, plant and equipment – net of tax – – – (61,966,495) 61,966,495 –
Effect of change in effective tax rate (note 40.2) – – – (354,078,825) – (354,078,825)


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STATEMENT OF CASH FLOWS
CASH FLOWS FROM OPERATING ACTIVITIES

Cash generated from operations 42. 4,754,863,046 3,514,913,233
Net decrease / increase in long-term loans to employees 2,713,292 (12,089,162)
Net increase in long-term deposits (2,563,069) –
Payments for defined benefits (31,587,729) (23,757,523)
Payments for workers’ profit participation fund (389,453,287) (223,495,586)
Payments for workers’ welfare fund (228,255,750) –
Payments for income tax - net (880,704,601) (776,564,037)
Net cash generated from operating activities 3,225,011,902 2,479,006,925
CASH FLOWS FROM INVESTING ACTIVITIES

Payments for acquisition of property, plant and equipment (1,738,305,384) (1,696,276,775)
Payments for long-term investment in financial assets (50,153,187) –
Proceeds from disposal of tangible fixed assets 72,615,000 34,923,824
Net proceeds from sale of assets classified as held for sale – 489,743,590
Profit received on term deposit receipts 49,380,738 583,978
Net cash used in investing activities (1,666,462,833) (1,171,025,383)
CASH FLOWS FROM FINANCING ACTIVITIES

Net repayments / proceeds from long-term financing (341,094,324) 610,925,541
Net proceeds from short-term borrowings 388,282,887 4,499,045,877
Net repayment / disbursement of short-term loans from Directors (19,373,776) 21,869,298
Payments for finance cost (3,859,932,713) (2,493,733,853)
Payments for dividends (969,509) (1,005,526,742)
Net cash used in / generated from financing activities (3,833,087,435) 1,632,580,121
NET DECREASE / INCREASE IN CASH AND CASH EQUIVALENTS (2,274,538,366) 2,940,561,663

CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 5,163,452,475 2,216,929,138
NET EXCHANGE DIFFERENCE ON FOREIGN CURRENCY ACCOUNTS (3,787,239) 5,961,674
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 43. 2,885,126,870 5,163,452,475

85
NOTES TO AND FORMING PART OF THE
FINANCIAL STATEMENTS
1 THE COMPANY AND IT’S OPERATIONS

Mughal Iron & Steel Industries Limited (the Company) was incorporated in Pakistan as a public limited company on
February 16, 2010 under the repealed Companies Ordinance, 1984 (now the Companies Act, 2017). The Company
is listed on the Pakistan Stock Exchange Limited (PSX). The Company’s operations comprise of ferrous and non-
ferrous business segments as disclosed in note 48. to these financial statements. However, the principal activity
of the Company is manufacturing and sale of mild steel products relating to ferrous segment. The Company is
domiciled in Lahore.
The geographical locations and addresses of the Company’s business units including plants are as follows:
Business unit: Geographical location / address:
- Registered office 31-A Shadman-1, Lahore
- Manufacturing plants 17-KM Sheikhupura Road, Lahore
- Warehouses 17-KM Sheikhupura Road, Lahore and Badami Bagh, Lahore
- Sales centres Badami Bagh, Lahore

2. BASIS OF PREPARATION
2.1 Statement of compliance
These financial statements have been prepared in accordance with the accounting and reporting standards as
applicable in Pakistan. The accounting and reporting standards applicable in Pakistan comprise of:
– International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board
(IASB) as notified under the Companies Act, 2017;
– Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan 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 IFRS and IFAS, the
provisions of and directives issued under the Companies Act, 2017 have been followed.
2.2 Basis of measurement

These financial statements have been prepared under the historical cost convention, except as otherwise stated in
relevant notes.
2.3 Functional and presentation currency

These financial statements are presented in Pakistan Rupee (Rs. / Rupees) which is the Company’s functional
currency.
3. KEY ACCOUNTING ESTIMATES & JUDGEMENTS

The preparation of financial statements in conformity with accounting and reporting standards as applicable in
Pakistan, requires the use of certain accounting estimates and exercise judgements in the process of applying the
Company’s accounting policies. Estimates and judgements are regularly evaluated and are based on historical
experience and various other factors that are believed to be reasonable under the circumstances. Actual results may
differ from these estimates. Revisions to accounting estimates are recognized in the period in which the estimate is
revised, if the revision affects only that period, or in the period of revision and future periods, if the revision affects
both current and future periods. The areas involving a high degree of judgement or complexity, or areas where
assumptions and estimates are significant to the financial statements, are documented in the following accounting
policies and notes, and relate primarily to:
86
i) Useful lives, residual values, depreciation method, fair value and impairment of property, plant and equipment
(note 4.1 and 6)
ii) Useful lives, residual values, amortization method and impairment of intangible asset (note 4.2 and 7)
iii) Provision for impairment of inventories (note 4.3)
iv) Defined benefit plan obligation (note 4.5 and 25)
v) Provision for current tax and recognition of deferred tax asset (note 4.6, 24 and 40)
vi) Due from the Government (note 4.6, 15 and 40)
vii) Revenue from contracts with customers (note 4.7)
viii) Financial instruments - fair value and allowances for expected credit losses (note 4.8, 12 and 50)
ix) Estimation of provisions (note 4.12)
x) Estimation of contingencies (note 4.13)
xi) Operating segments (note 4.18 and 48)
xii) Leases (note 4.19)
xiii) Deferred grant (note 4.22)
xiv) Control over associates (note 4.23)

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these financial statements are set out below. These
polices have been consistently applied to all the years presented, unless otherwise stated.
4.1 Property, plant and equipment

Items of property, plant and equipment are initially measured at cost. Cost comprises of historical cost, borrowing
cost pertaining to the erection period and other directly attributable costs of bringing the assets to their working
condition. Subsequently, these are measured at cost less accumulated depreciation and accumulated impairment
loss, if any, except for freehold land which is stated at revalued amount less accumulated impairment, if any, whereas,
factory building on freehold land, plant and machinery, power plant and other machinery and equipment are stated
at revalued amounts less subsequent accumulated depreciation and accumulated impairment, if any. Subsequent
costs are included in the carrying amount of the items of property, plant and equipment 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 the cost can be measured reliably. Cost incurred to replace a component of an item of property,
plant and equipment is capitalized and the asset so replaced is derecognized. The cost of the day to day servicing
is charged to statement of profit or loss.
Any revaluation increase arising on revaluation of items of property, plant and equipment is recognized in other
comprehensive income (OCI) and presented as a separate component of equity as “Revaluation surplus on property,
plant and equipment” net of related deferred taxation, except to the extent that it reverses a revaluation decrease
for the same asset previously recognized in profit or loss, in which case the increase is credited to profit or loss to
the extent of the decrease previously charged. Accumulated depreciation outstanding as at the revaluation date is
eliminated against the gross carrying amount of the items of property, plant and equipment revalued and the net
amount is restated to the revalued amount of the items of property, plant and equipment revalued. Any decrease
as a result of revaluation of items of property, plant and equipment is recognized in the statement of profit or loss,
however, a decrease is recorded in statement of other comprehensive income to the extent of any credit balance entry
in revaluation surplus in respect of same assets. An annual transfer from the revaluation surplus on property, plant
and equipment to un-appropriated profits is made for the difference between depreciation based on the revalued
carrying amount of the asset and the depreciation based on assets original cost (net of deferred tax).
87
Depreciation is charged to statement of profit or loss applying the reducing balance method except for developments
on leasehold lands and solar plant which is depreciated on straight line method, at the rates given in note 6.1 to the
financial statements to write off the depreciable amount of each asset over its estimated useful life. Depreciation is
charged from the date when the asset becomes available for use up to the date of its disposal.
An item of property, plant and equipment is derecognized upon disposal or when no future economic benefit is
expected from its use or disposal. Any gain or loss on disposal or de-recognition (calculated as the difference
between the net disposal proceeds and carrying amount of the asset) is taken to statement of profit or loss. In case
of disposal of revalued item of property, plant and equipment, any revaluation surplus relating to the particular asset
being sold is transferred to un-appropriated profits.

The useful lives, residual values and depreciation method are reviewed on a regular basis. The effect of any changes
in estimate is accounted for on a prospective basis. Further, the key assumptions used to determine the fair value of
property, plant and equipment are provided in note 6.
Capital work-in-progress:
These are stated at cost less identified accumulated impairment losses, if any. All expenditure connected with
specific assets incurred and advances made during installation and construction period are carried under capital
work-in-progress. These are transferred to specific assets as and when these are made available for use.
Impairment:
Impairment test for property, plant and equipment is performed when there is an indication of impairment. At each
period end, an assessment is made to determine whether there is any indication of impairment. If any indications
exist, an estimate of the recoverable amount is calculated. The recoverable amount of an asset or cash-generating
unit is the greater of its value in use and its fair value less costs to sell. If the carrying amount of the asset exceeds its
recoverable amount, the asset is impaired and an impairment loss is charged to the statement of profit or loss so as
to reduce the carrying amount of the asset to its recoverable amount.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. Value in use is the present value of future cash flows expected
to be derived from an asset or cash generating unit (CGU).
An impairment loss is recovered if there has been a change in the estimate used to determine the recoverable
amount. An impairment loss is reversed only 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 any.
For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest
group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of
other assets or groups of assets (the “cash-generating unit, or CGU”).
4.2 Intangible asset

Intangible assets acquired separately are initially measured at cost. After initial recognition, these are measured at
cost less accumulated amortization and accumulated impairment losses. Costs associated with routine maintenance
of intangible assets are recognized as an expense when incurred. However, costs that are directly attributable to
identifiable intangible assets and which enhance or extend the performance of intangible assets beyond the original
specification and useful life is recognized as capital improvement and added to the original cost of the intangible
assets. Intangible asset is estimated to have definite useful live and is amortized from the date it is acquired or made
available for use, using the straight line method at the rate of 20%. Intangible asset is reviewed at each reporting date
to identify circumstances indicating occurrence of impairment loss or reversal of previous impairment losses, if any.
If any such indications exist, an estimate of the recoverable amount is calculated and impairment loss is recognized
for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is
the higher of an asset’s fair value less cost to sell and value in use. Reversal of impairment loss is restricted to the
88
original cost of the asset. The useful lives, residual values and amortization method are reviewed on a regular basis.
The effect of any changes in estimate accounted for on a prospective basis.
4.3 Inventories
These are stated at lower of cost and net realizable value. Cost is determined as follows:
Stores, spares and loose tools at moving average cost of invoice value plus other charges (if any) incurred
thereon
Raw material
- Externally purchased at moving average cost of invoice value plus other charges (if any) incurred thereon
- Internally manufactured at weighted average cost of estimated manufacturing cost
Finished goods at weighted average cost of estimated manufacturing cost
Trading goods at moving average cost of invoice value plus other charges (if any) incurred thereon
In-transit at invoice value plus charges incurred thereon
End cuts at estimated replacement cost
Wastage / By-products at net realizable value
Estimated manufacturing cost consists of material, labor and other attributable overheads.

Net realizable value signifies the estimated selling price in the ordinary course of business less cost necessary to be
incurred for its sale. Net realizable value of stores, spares and loose tools and raw material inventory is determined
on the basis of replacement cost. Cost of inventories held for use in production of finished goods is not written down
below cost, if the finished products for which they will be consumed are expected to be sold at or above cost.

The Company reviews the carrying amount of inventories on a regular basis and as appropriate, inventory is written
down to its net realizable value or provision is made for obsolescence / excess inventories, if there is any change in
usage pattern and / or physical form of related inventory. Inventory write-down is made based on the current market
conditions, historical experience and selling goods of similar nature, which can change significantly as a result of
changes in market conditions. Major spare parts and stand-by equipment qualify as property, plant and equipment
when the Company expects to use them for more than one year. Transfers are made to tangible fixed assets category
as and when such items are available for use.
4.4 Foreign currency transactions and translation

Transactions in foreign currencies are translated to Pakistani Rupees at the foreign exchange rates prevailing on the
date of transaction. Monetary assets and liabilities in foreign currencies are re-translated into Pakistani Rupees at
the foreign exchange rates approximating those prevailing at the statement of financial position date. When there
is temporary lack of exchangeability then rate subsequent to the reporting date, is used for translation of foreign
currency balances at the reporting date. Exchange differences, if any, are charged to the statement of profit or loss.

4.5 Employee benefits
Post-employment benefit:
The Company’s post employment benefit comprises of a defined benefit plan. The defined benefit plan represents
an unfunded gratuity scheme for all its permanent employees subject to a minimum qualifying period of service
according to the terms of employment. The plan defines the amount which an employee will receive on or after
retirement, usually dependent on one or more factors such as age, years of service, and compensation. Provision is
made annually to cover obligation under the scheme.
The liability recognized in the statement of financial position in respect of the defined benefit plan is the present
value of the defined benefit obligation at the end of the reporting period less the fair value of any plan assets, if any.
89
The defined benefit obligation is calculated annually by an independent actuary using Projected Unit Credit (PUC)
method. The present value of the defined benefit obligation is determined by discounting the estimated future cash
flows using discount rate as determined by reference to market yields on Government bonds. In determining the
liability, estimation is also made in respect of salary increases over upcoming years and the number of employees
expected to leave before they receive the benefits. Actuarial gains and losses arising from experience adjustments
and changes in actuarial assumptions are charged or credited to equity in other comprehensive income in the period
in which they arise. Past service costs are recognized immediately in the statement of profit or loss. Latest valuation
was conducted on June 30, 2023.

Following risks are associated with the scheme:

Final salary risk:
The risk that the final salary at the time of cessation of service is greater than what we assumed. Since the benefit
is calculated on the final salary (which will closely reflect inflation and other macroeconomic factors), the benefit
amount increases as salary increases.

Demographic risk:
a) Mortality risk - The risk that the actual mortality experience is different than the assumed mortality. This effect is
more pronounced in schemes where the age and service distribution is on the higher side.

b) Withdrawal risk - The risk of actual withdrawals experience is different from assumed withdrawal probability. The
significance of the withdrawal risk varies with the age, service and the entitled benefits of the beneficiary.

c) Discount rate fluctuation risk - The plan liabilities are calculated using a discount rate set with reference to corporate
bond yields. Decrease in corporate bond yields will increase the plan liabilities.

Short-term employee benefits:
A liability is recognized for benefits accruing to employees in respect of wages and salaries and other short-term
employee benefits in the period the related service is rendered at the undiscounted amount of the benefits expected
to be paid in exchange for that service.
Other long-term employee benefits:

The measurement of other long‑term employee benefits is not usually subject to the same degree of uncertainty
as the measurement of post‑employment benefits. Therefore, simplified method of accounting is used for other
long‑term employee benefits.

4.6 Income tax
The taxation expense for the year comprises of current, prior and deferred tax. Tax is recognized 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 which case, it is recognized in other comprehensive income or directly in equity, as the case may be.

Current:
The charge for current tax is calculated using prevailing tax rates or tax rates expected to apply to profit for the
year, if enacted or substantively enacted at the end of the reporting period in accordance with the prevailing law for
taxation of income, after taking into account tax credits, rebates and exemptions, if any. Management periodically
evaluates position taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretation and considers whether it is probable that the tax authorities will accept an uncertain tax treatment.
Significant judgment is required in determining the income tax expenses and corresponding provision for tax. There
are many transactions and calculations for which the ultimate tax determination is uncertain as these matters are
being contested at various legal forums. The Company recognizes liabilities for anticipated tax issues based on
90
estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the
amounts that were initially recorded, such differences will impact the current and deferred tax assets and liabilities in
the period in which such determination is made.
Prior:
This includes adjustments, where considered necessary, to existing provision for tax made in previous years arising
from assessments framed during the period for such years.

Deferred:
Deferred tax is accounted for using the balance sheet liability method in respect of 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 taxable profit. The calculation of deferred tax involves an estimate of future ratio
of export and local sales considering the current trends and future expectations.

Deferred tax liabilities are recognized for all taxable temporary differences and deferred tax assets are recognized 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 not recognized on temporary differences arising
from the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects
neither accounting nor taxable profit or loss, and differences arising on the initial recognition of goodwill. 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. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset
current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable
entity, or on different taxable entities, but they intend to settle current tax liabilities and assets on a net basis or their
tax assets and liabilities will be realized simultaneously. The carrying amount of deferred tax assets is reviewed at
each reporting date and is adjusted to reflect the current assessment of future taxable profits. If required, carrying
amount of deferred tax asset is reduced to the extent that it is no longer probable that sufficient taxable profits to
allow the benefit of part or all of that recognized deferred tax asset to be utilized. Any such reduction is reversed to
the extent that it becomes probable that sufficient taxable profit will be available.

4.7 Revenue recognition
The Company’s business mainly comprises of sale of ferrous and non-ferrous related products, comprising primarily
of “steel re-bars”, “girders”, “billets”, “copper ingots”, “copper granules” and “iron waste”.

Revenue from contracts with customers is recognized when control of the goods is transferred to the customer at an
amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods and
the performance obligations are satisfied. The Company’s contract performance obligations are fulfilled at the point
in time when the goods are dispatched / shipped to the customer. Invoices are generated and revenue is recognized
at that point in time, as the control has been transferred to the customers.

Revenue is measured based on the consideration specified in a contract with a customer. In determining the
transaction price for the sale of goods, the Company considers the effects of variable consideration, the existence of
significant financing components, non-cash consideration, and consideration payable to the customer (if any). The
Company’s contract with customers do not contain any other promises that are separate performance obligations to
which a portion of the transaction price needs to be allocated.

If the consideration in a contract includes a variable amount, the Company estimates the amount of consideration to
which it will be entitled in exchange for transferring the goods to the customer. The variable consideration is estimated
at contract inception and constrained until it is highly probable that a significant revenue reversal in the amount of
cumulative revenue recognized will not occur when the associated uncertainty with the variable consideration is
subsequently resolved. The Company does not enter into any contracts that provide customers with a right of return
which give rise to variable consideration, nor any volume rebates / discounts are given.
91
The Company only receives short-term advances from its customers. Using the practical expedient, the Company
does not adjust the promised amount of consideration for the effects of a significant financing component, if it
expects, at contract inception, that the period between the transfer of the promised good or service to the customer
and when the customer pays for that good or service will be one year or less.
The Company applies the requirements of IFRS - 13 Fair Value Measurement in measuring the fair value of the non-
cash consideration (if any). If the fair value cannot be reasonably estimated, the non-cash consideration is measured
indirectly by reference to the stand-alone selling price of the respective material.

The Company pays sales commission to agents for each contract that they obtain for sales of different goods.
The Company has elected to apply the optional practical expedient for costs to obtain a contract which allows
the Company to immediately expense sales commissions because the amortization period of the asset that the
Company otherwise would have used is one year or less.

The Company’s policy relating to expected credit losses of trade debts and contract assets is mentioned in note 4.8.

The Company’s policy relating to rental income is mentioned in note 4.19.

The Company’s policy relating to income from financial assets is mentioned in note 4.20.

Miscellaneous / other income is recognized on occurrence of transactions.

4.8 Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity
instrument of another entity.

Initial recognition and measurement:
Trade debts and debt securities issued, if any, are initially recognized when they are originated. All other financial
assets and financial liabilities are initially recognized when the Company becomes a party to the contractual provisions
of the instrument.

A financial asset (unless it is a trade debt without a significant financing component) or financial liability is initially
measured at fair value plus or minus, for an item not at fair value through profit or loss (FVTPL), transaction costs that
are directly attributable to its acquisition or issue. A trade debt without a significant financing component is initially
measured at the transaction price.

Classification and subsequent measurement:
Financial assets
On initial recognition, a financial asset is classified as measured at: amortized cost, fair value through other
comprehensive income (FVOCI) – debt investment; fair value through other comprehensive income – equity investment
or fair value through profit or loss (FVTPL), as appropriate. Financial assets are not reclassified subsequent to their
initial recognition unless the Company changes its business model for managing financial assets, in which case
all affected financial assets are reclassified on the first day of the first reporting period following the change in the
business model.

The Company classifies all its financial assets as measured at amortized cost. The classification is made in accordance
with the Company’s business model for managing the financial assets and contractual cash flow characteristics of
the financial assets. This classification is only made when the Company’s financial assets are held within a business
model whose objective is to hold financial assets in order to collect contractual cash flows and when the contractual
cash flows of the financial asset give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding. The Company does not hold any equity investments.
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Financial liabilities
On initial recognition, financial liabilities are classified as measured at amortized cost or FVTPL, as appropriate. 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. Subsequently, financial liabilities at FVTPL are measured at fair value and net gains and
losses, including any interest expense, are recognized in the statement of profit or loss. Other financial liabilities are
subsequently measured at amortized cost using the effective interest method. Amortized cost is calculated by taking
into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest
rate. The effective interest rate amortization is included as finance costs in the statement of profit or loss. Interest
expense and foreign exchange gains and losses are recognized in the statement of profit or loss. Any gain or loss on
derecognition is also recognized in the statement of profit or loss. The Company classifies all of its financial liabilities
as ‘Other financial liabilities’.

Derecognition:
Financial assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset
expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the
risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor
retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

The Company derecognizes a financial liability when its contractual obligations are discharged or cancelled, or expire.
The Company also derecognizes a financial liability when it’s terms are modified and the cash flows of the modified
liability are substantially different, in which case a new financial liability based on the modified terms is recognized at
fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the
consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in the statement
of profit or loss.

Offsetting of financial assets and financial liabilities:
Financial assets and financial liabilities are offset and the net amount is presented in the statement of financial
position when, and only when, the Company currently has a legally enforceable right to set off the amounts and it
intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously.

Effective interest method:
The effective interest method is a method of calculating the amortized cost of a financial instrument and of allocating
interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts future
cash receipts or payments through the expected life of the financial instrument, or where appropriate, a shorter
period.

Equity instruments:
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting
all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.

Impairment policy:
The Company recognizes loss allowances for expected credit losses (ECLs) on:

– financial assets measured at amortized cost;
– debt investments measured at FVOCI (if any); and
– contract assets (if any).
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The Company does not have any debt investments measured at FVOCI or contract assets.
In respect of trade debts, the Company applies the simplified approach to calculating ECLs. Therefore, the Company
does not track changes in credit risk, but instead recognizes a loss allowance based on lifetime ECLs at each
reporting date. The Company has established a provision matrix. To measure the expected credit losses, trade
debts have been grouped based on days overdue. The Company calibrates the matrix to adjust the historical credit
loss experience with forward looking information. For instance, if forecast economic conditions are expected to
deteriorate over the next year which can lead to an increased number of defaults in the sector, the historical default
rates are adjusted. At every reporting date, the historical observed default rates are updated and changes in the
forward-looking estimates are analyzed. The assessment of the correlation between historical observed default rates,
forecast economic conditions and ECLs is a significant estimate. The amount of ECLs is sensitive to changes in
circumstances and of forecast economic conditions. The Company’s historical credit loss experience and forecast
of economic conditions may also not be representative of customer’s actual default in the future.

For financial assets (other than trade debts) whose credit risk has not significantly increased since initial recognition,
loss allowance equal to twelve months expected credit losses is recognized. Loss allowance equal to the lifetime
expected credit losses is recognized if the credit risk on these financial asset has significantly increased since initial
recognition. When determining whether the credit risk of a financial asset has increased significantly since initial
recognition and when estimating ECLs, the Company considers reasonable and supportable information that is
relevant and available without undue cost or effort. For debt instruments at amortized cost, the Company applies
the low credit risk simplification. At every reporting date, the Company evaluates whether the debt instrument is
considered to have low credit risk using all reasonable and supportable information that is available without undue
cost or effort. In making that evaluation, the Company reassesses the internal credit rating of the debt instrument. In
addition, the Company considers that there has been a significant increase in credit risk when contractual payments
are more than 30 days past due.

At each reporting date, the Company assesses whether financial assets carried at amortized cost and debt securities
at FVOCI (if any), are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a
detrimental impact on the estimated future cash flows of the financial asset have occurred. The Company considers
a financial asset to be in default when internal or external information indicates that the Company is unlikely to
receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the
Company. Evidence that a financial asset is credit-impaired includes the following observable data:

– significant financial difficulty of the borrower / customer;
– a breach of contract such as a default or being more than 365 days past due; or
– it is probable that the borrower / customer will enter bankruptcy.

Presentation of allowance for ECLs in the statement of financial position
Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the
assets.

Write-off
The gross carrying amount of a financial asset is written-off when the Company has no reasonable expectations of
recovering a financial asset in its entirety or a portion thereof. The Company makes an assessment with respect to
the timing and amount of write-off based on whether there is a reasonable expectation of recovery.
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4.9 Trade and other payables
These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year
which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other
payables are presented as current liabilities unless payment is not due within 12 months after the reporting period.
4.10 Balances from contract with customers

Contract assets:
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the
Company performs by transferring goods to a customer before the customer pays consideration or before payment
is due, a contract asset is recognized for the earned consideration that is conditional.
Trade debts:
Trade debts represent the Company’s right to an amount of consideration that is unconditional. Trade debts are
carried at original invoice amount less expected credit losses based on a review of all outstanding amounts at the
year end. Bad debts are written off when identified.

Contract liabilities:
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received
consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before
the Company transfers goods to the customer, a contract liability is recognized when the payment is made or the
payment is due (whichever is earlier). Contract liabilities are recognized as revenue when the Company performs
under the contract.

Right of return assets:
Right of return asset represents the Company’s right to recover the goods expected to be returned by customers.
Such asset (if any) is measured at the former carrying amount of the inventory, less any expected costs to recover the
goods, including any potential decreases in the value of the returned goods. The measurement of the asset recorded
(if any) is updated for any revisions to its expected level of returns, as well as any additional decreases in the value
of the returned products.

Refund liabilities:
A refund liability (if any) is the obligation to refund some or all of the consideration received (or receivable) from the
customer and is measured at the amount the Company ultimately expects it will have to return to the customer. The
estimates of refund liabilities (if any) and the corresponding change in the transaction price are updated at the end
of each reporting period.

4.11 Cash and cash equivalents
Cash and cash equivalents comprise of cash in hand, balances with banks and investments with maturities of three
months or less from acquisition date that are subject to insignificant risk of changes in fair value. Bank overdrafts
that are repayable on demand and form an integral part of the Company’s cash management are included as a
component of cash and cash equivalents for the purpose of statement of cash flows.

4.12 Provisions
A provision is recognized in the statement of financial position when the Company has a legal or constructive
obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle
the obligation and a reliable estimate can be made of the amount of obligation. Provisions are measured at the
present value of management’s best estimate of the expenditure required to settle the present obligation at the end
of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current
market assessments of the time value of money and the risks specific to the liability. The increase in the provision due
95
to the passage of time is recognized as interest expense. As the actual outflows can differ from estimates made for
provisions due to changes in laws, regulations, public expectations, technology, prices and conditions, and can take
place many years in the future, the carrying amounts of provisions are reviewed at each reporting date and adjusted
to take account of such changes. Any adjustments to the amount of previously recognized provision is recognized
in the statement of profit or loss unless the provision was originally recognized as part of cost of an asset.
4.13 Contingent liabilities

A contingent liability is disclosed when the Company has a possible obligation as a result of past events, whose
existence will be confirmed only by the occurrence or non-occurrence, of one or more uncertain future events not
wholly within the control of the Company; or the Company has a present legal or constructive obligation that arises
from past events, but it is not probable that an outflow of resources embodying economic benefits will be required to
settle the obligation, or the amount of the obligation cannot be measured with sufficient reliability.
4.14 Borrowing costs

Borrowing costs are recognized as an expense in the period in which these are incurred except in cases where
such costs are directly attributable to the acquisition, construction or production of a qualifying asset (one that takes
substantial period of time to get ready for use or sale) in which case such costs are capitalized as part of the cost of
that asset.
4.15 Share capital

Ordinary shares are classified as equity instruments and recognized at their face value. Transaction costs of an equity
transaction are accounted for as a deduction from equity to the extent they are incremental costs directly attributable
to the equity transaction that otherwise would have been avoided.

4.16 Dividend and reserve appropriations
Final dividend distributions to the Company’s shareholders are recognized as a liability in the financial statements
in the period in which the dividends are approved by the Company’s shareholders at the Annual General Meeting,
while interim dividend distributions are recognized in the period in which the dividends are approved by the Board of
Directors. Any other movements in reserves are recognized in the year in which the appropriations are approved.
4.17 Earnings per share

The Company presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is
calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average
number of ordinary shares outstanding during the year. Diluted EPS is determined by adjusting the profit or loss
attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects
of all dilutive potential ordinary shares.

4.18 Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision-maker. The chief executive officer (CEO) has been identified as the ‘chief operating decision-maker’, who
is responsible for allocating resources and assessing performance of the operating segments. Segment results
that are reported to the CEO 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 operations principally comprise of
two segments ‘Ferrous segment’ and ‘Non-ferrous segment’. Ferrous segment comprises of long-rolled mild steel
related products whereas non-ferrous segment comprises mainly of copper products and related iron and other
waste items.
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4.19 Leases
The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Company as a lessee:
The Company has elected not to recognize right-of-use asset and corresponding lease liability for short-term leases
with terms of 12 months or less and leases of low-value assets. The lease payments associated with these leases
are recognized as an expense on a straight-line basis over the lease term.
Company as a lessor:
Leases for which the Company is a lessor are classified as finance or operating leases. Whenever the terms of the
lease transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance
lease. All other leases are classified as operating leases. Rental income from operating leases is recognized on a
straight-line basis over the term of the relevant lease. Assets subject to operating lease are initially stated at cost
and subsequently at cost / revalued amounts less accumulated depreciation and accumulated impairment, if any,
as the case may be. The revaluation, impairment and depreciation policy for assets subject to operating leases is
consistent with the normal policy in respect of tangible fixed assets as mentioned in note 4.1.
4.20 Interest income and finance costs

Interest income comprises income on funds invested in long-term finance certificates, short-term deposit receipts
and saving accounts. Interest income is recognized as it accrues in statement of profit or loss, using effective interest
method.

Finance costs comprise interest expense on borrowings and impairment losses recognized on financial assets, if
any. The Company’s policy relating to borrowing costs is mentioned in note 4.14. Foreign currency gains and losses
are reported on a net basis.

4.21 Loans, deposits, interest accrued and other receivables
These are classified at amortized cost and are initially recognized when they are originated and measured at fair value
of consideration receivable. These assets are written off when there is no reasonable expectation of recovery.

4.22 Deferred grant
State Bank of Pakistan (SBP) had introduced various refinance schemes. One of the key features of the refinance
schemes was that borrowers could obtain loan at interest rates that were below normal lending rates and hence
included transfer of resources from the Government to the borrowers in the form of below-market interest rate on
the loans obtained under the refinance schemes. Accordingly, the loans obtained under the various SBP refinance
schemes were recognized at fair value which was the present value of loan proceeds received discounted using
prevailing market rates of interest for similar instruments, whereas, the benefit in the form of the below-market interest
rate was determined as ‘Deferred Grant’ since it involved assistance by the Government in the form of transfers of
resources to the Company. The deferred grants were initially recognized at their fair value and are subsequently
recognized in statement of profit or loss, in line with the recognition of interest expenses the grant is compensating.
4.23 Control over associates

The management determined whether or not the Company is a parent by assessing whether or not it has control
over its associated companies (associates based upon common directorship / shareholding). The assessment is
based upon whether the Company has the practical ability to direct the relevant activities of associated companies
unilaterally. In making its judgement, the management considers the following:
97
– power over the associated companies;

– exposure, or rights, to variable returns from its involvement with the associated companies; and
– the ability to use its power over the associated companies to affect the amount of the Company’s returns.

The Board of Directors have confirmed that the Company has no involvement in the activities of the associated
companies nor is the Company exposed to, or have any rights, to any returns from the associated companies.
Based upon its assessment, the management has concluded that the Company does not have control or significant
influence over its associated companies and is therefore, not regarded as “Parent Entity”.
4.24 Non-current assets classified as held for sale

Assets classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell.
Assets are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than
through continuing use. This condition is regarded as met only when the sale is highly probable and the asset is
available for immediate sale in it’s present condition. Immediately before the initial classification of the non-current
asset as held for sale, the carrying amount of the asset is measured in accordance with previous revaluation model
in terms of IAS - 16 ‘Property, Plant and Equipment’ and checked for impairment. Decrease in the asset’s carrying
amount as a result of impairment, is recognized in other comprehensive income to the extent of any credit balance
existing in the revaluation surplus in respect of that asset. The decrease recognized in other comprehensive income
reduces the amount accumulated in equity under the heading of revaluation surplus. Any outstanding revaluation
surplus balance existing on the date of reclassification to held for sale remains there until the asset is sold, at which
point the said balance is transferred to un-appropriated profits.

5. ADOPTION OF NEW AND AMENDED STANDARDS
5.1 Standards, amendments to published standards and interpretations that are effective in the current
year
Certain standards, amendments and interpretations to IFRS were effective for accounting periods beginning on July
1, 2022 but were considered to be relevant or to have any significant effect on the Company’s operations (although
they may affect the accounting for future transactions and events) and are, therefore, not detailed in these financial
statements.
5.2 Standards, amendments and interpretations to existing standards that are not yet effective and
have not been early adopted by the Company
Following are the standards and amendments to the IFRS that are mandatory for companies having accounting
periods beginning on or after July 1, 2023 and have not been early adopted by the Company. These are considered
either not to be relevant or to have any significant effect on the Company’s operations upon their initial application
and are, therefore, not detailed in these financial statements:
Effective date
(annual periods
beginning on or after)
Amendments to existing Standards:
IFRS - 16 Leases
Amendments to clarify how a seller-lessee subsequently measures
sale and leaseback transactions. 1 January 2024

IFRS - 17 Insurance Contracts
Amendments to address concerns and implementation challenges
that were identified after IFRS 17. 1 January 2023
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Effective date
(annual periods
beginning on or after)
IAS - 1 Presentation of Financial Statements
Amendments regarding the classification of debt with covenants. 1 January 2024

Amendments regarding classification of liabilities. 1 January 2024

Amendment to defer the effective date of the January 2020 amendments. 1 January 2024
IAS - 7 Statement of Cash Flows

Amendments regarding supplier finance arrangements. 1 January 2024

IAS - 8 Accounting Policies, Changes in Accounting Estimates and Errors
Amendments regarding the definition of accounting estimates. 1 January 2023

IAS - 12 Income Taxes
Amendments regarding deferred tax on leases and .
decommissioning obligations. 1 January 2023

Amendments to provide a temporary exception to the requirements
regarding deferred tax assets and liabilities related to pillar two
income taxes. 1 January 2023

* IFRS - 1 - (First Time Adoption of International Financial Reporting Standards), IFRS - 17 - (Insurance Contracts)
and IFRIC - 12 - (Service concession arrangements), have not been notified locally or declared exempt by the SECP
as at June 30, 2023.
6.
PROPERTY, PLANT AND EQUIPMENT
Tangible fixed assets 6.1 18,250,834,254 14,814,802,289
Capital work-in-progress 6.2 1,441,155,379 1,645,923,732
19,691,989,633 16,460,726,021
99
100
6.1 Reconciliation of carrying amounts of tangible fixed assets - owned and assets subject to operating lease at the beginning and end of the year is as follows:
Tangible fixed assets–owned

Freehold Factory Building Plant Coal gasification Power Solar Weighing Office Grid Station Furniture Vehicles Trucks Arms Computers Office Building Other Machinery Developments Total Assets Subject to Total
Land on Freehold and plant Plant Plant Machine Equipment and Electric and and and on Leasehold and on Leasehold Operating Lease –
Land Machinery Installations Fittings Cranes Ammunitions Land Equipments Lands Plant and Machinery
Rupees
Gross carrying value basis

As at June 30, 2021
Cost / revalued amount 567,500,000 282,638,499 11,520,259,965 30,463,089 1,640,645,000 – 218,434 12,241,941 386,661,108 6,326,034 345,424,344 177,378,116 260,693 16,035,752 30,400,000 23,023,350 237,738,063 15,277,214,388 – 15,277,214,388
Accumulated depreciation – (9,385,147) (145,697,171) (7,404,925) (47,668,603) – (48,017) (4,100,863) (75,842,102) (2,523,607) (173,814,891) (42,927,113) (161,158) (11,259,898) (24,449,681) (196,034) (273,562) (545,752,772) – (545,752,772)
Net book value 567,500,000 273,253,352 11,374,562,794 23,058,164 1,592,976,397 – 170,417 8,141,078 310,819,006 3,802,427 171,609,453 134,451,003 99,535 4,775,854 5,950,319 22,827,316 237,464,501 14,731,461,616 – 14,731,461,616
Net carrying value basis

Year ended June 30, 2022
Opening net book value 567,500,000 273,253,352 11,374,562,794 23,058,164 1,592,976,397 – 170,417 8,141,078 310,819,006 3,802,427 171,609,453 134,451,003 99,535 4,775,854 5,950,319 22,827,316 237,464,501 14,731,461,616 – 14,731,461,616
Transfers to leased assets – – (271,473,590) – – – – – – – – – – – – – – (271,473,590) 271,473,590 –
Additions – – 6,777,984 – – – – 4,421,962 2,992,801 – 57,275,229 – – – – – – 71,467,976 – 71,467,976
Transfers from capital work–in–progress – – 726,606,946 – – 189,915,084 – – 130,344,341 – – – – – – – – 1,046,866,371 – 1,046,866,371
Disposals – – – – – – – – – – (20,791,085) – – – – – – (20,791,085) – (20,791,085)
Transfer to assets classified as held for sale – – (277,908,332) (22,767,568) – – – – – – – – – – – – – (300,675,900) (268,052,279) (568,728,179)
Depreciation charge for the year – (10,930,134) (283,976,265) (290,596) (55,754,174) (2,333,094) (4,260) (1,016,349) (18,609,970) (380,243) (28,745,243) (20,167,650) (9,954) (1,432,756) (1,190,064) (570,683) (16,641,664) (442,053,099) (3,421,311) (445,474,410)
Balance as at June 30, 2022 567,500,000 262,323,218 11,274,589,537 – 1,537,222,223 187,581,990 166,157 11,546,691 425,546,178 3,422,184 179,348,354 114,283,353 89,581 3,343,098 4,760,255 22,256,633 220,822,837 14,814,802,289 – 14,814,802,289
Depreciation Rate (%) – 4 2.50 2.50 3.50 4.00 2.50 10 5 10 15 15 10 30 20 2.50 7 – 2.50 –

As at June 30, 2022
Cost / revalued amount 567,500,000 282,638,499 11,688,997,495 – 1,640,645,000 189,915,084 218,434 16,663,903 519,998,250 6,326,034 352,069,716 177,378,116 260,693 16,035,752 30,400,000 23,023,350 237,738,063 15,749,808,389 – 15,749,808,389
Accumulated depreciation – (20,315,281) (414,407,958) – (103,422,777) (2,333,094) (52,277) (5,117,212) (94,452,072) (2,903,850) (172,721,362) (63,094,763) (171,112) (12,692,654) (25,639,745) (766,717) (16,915,226) (935,006,100) – (935,006,100)
Net book value 567,500,000 262,323,218 11,274,589,537 – 1,537,222,223 187,581,990 166,157 11,546,691 425,546,178 3,422,184 179,348,354 114,283,353 89,581 3,343,098 4,760,255 22,256,633 220,822,837 14,814,802,289 – 14,814,802,289

Year ended June 30, 2023
Opening net book value 567,500,000 262,323,218 11,274,589,537 – 1,537,222,223 187,581,990 166,157 11,546,691 425,546,178 3,422,184 179,348,354 114,283,353 89,581 3,343,098 4,760,255 22,256,633 220,822,837 14,814,802,289 – 14,814,802,289
Additions – – 62,893,117 – – – – 2,089,138 15,469,885 – 92,065,175 – – 1,116,059 – – – 173,633,374 – 173,633,374
Transfers from capital work–in–progress – 27,072,607 1,638,765,489 – – – – – – – – – – – – – 103,602,267 1,769,440,363 – 1,769,440,363
Disposals – – – – – – – – – – (21,759,169) – – – – – – (21,759,169) – (21,759,169)
Revaluation surplus 68,100,000 31,263,505 1,641,484,718 – 217,330,556 – – – – – – – – – – 13,299,783 – 1,971,478,562 – 1,971,478,562
Depreciation charge for the year – (10,492,929) (289,908,705) – (53,802,778) (7,216,773) (4,154) (1,285,970) (21,790,065) (342,218) (34,239,963) (17,142,503) (8,958) (1,144,144) (952,051) (556,416) (17,873,538) (456,761,165) – (456,761,165)
Balance as at June 30, 2023 635,600,000 310,166,401 14,327,824,156 – 1,700,750,001 180,365,217 162,003 12,349,859 419,225,998 3,079,966 215,414,397 97,140,850 80,623 3,315,013 3,808,204 35,000,000 306,551,566 18,250,834,254 – 18,250,834,254
Depreciation Rate (%) – 4 2.50 – 3.50 4.00 2.50 10 5 10 15 15 10 30 20 2.50 7 –

As at June 30, 2023
Cost / revalued amount 635,600,000 310,166,401 14,327,824,156 – 1,700,750,001 189,915,084 218,434 18,753,041 535,468,135 6,326,034 388,648,134 177,378,116 260,693 17,151,811 30,400,000 35,000,000 341,340,330 18,715,200,370 – 18,715,200,370
Accumulated depreciation – – – – – (9,549,867) (56,431) (6,403,182) (116,242,137) (3,246,068) (173,233,737) (80,237,266) (180,070) (13,836,798) (26,591,796) – (34,788,764) (464,366,116) – (464,366,116)
Net book value 635,600,000 310,166,401 14,327,824,156 – 1,700,750,001 180,365,217 162,003 12,349,859 419,225,998 3,079,966 215,414,397 97,140,850 80,623 3,315,013 3,808,204 35,000,000 306,551,566 18,250,834,254 – 18,250,834,254
Rupees
2023 2022
6.1.1
The depreciation charge for the year has been allocated as follows:
Cost of sales 404,615,323 389,246,909
Administrative expenses 52,145,842 56,227,501
456,761,165 445,474,410
6.1.2 Freehold land, factory building on freehold land, plant and machinery, power plant and other machinery and
equipment are measured using the revaluation model. The fair value of these assets is determined periodically. The
latest revaluation to assess the fair value of these assets was conducted on June 30, 2023 and performed by an
independent valuer - M/s Tristar International Consultant (Private) Limited, having appropriate qualifications and recent
experience in the fair value measurement of properties in the relevant locations. Revaluation was carried out on the
basis of information from various real estate agents of present market values of similar property in the vicinity for
freehold land, replacement values of similar types of buildings based on present cost of construction for factory
building on freehold land and valuations of plant and machinery, other machinery and equipment and power plant
based on the estimated gross replacement cost, depreciated to reflect the residual service potential of the assets
taking account age, condition, location, design, adverse factors, threats and opportunities and obsolescence. There
has been no change to the valuation technique during the year.
6.1.3 Information about the fair value hierarchy of freehold land, factory building on freehold land, plant and machinery,
other machinery and equipment and power plant as at the end of the reporting period are as follows:
Rupees Level 2 Level 3 Fair value

Freehold land 635,600,000 – 635,600,000
Factory building on freehold land – 310,166,401 310,166,401
Plant and machinery 14,327,824,156 – 14,327,824,156
Power plant 1,700,750,001 – 1,700,750,001
Other machinery and equipment 35,000,000 – 35,000,000
June 30, 2023 16,699,174,157 310,166,401 17,009,340,558
Freehold land 567,500,000 – 567,500,000

Factory building on freehold land – 262,323,218 262,323,218
Plant and machinery 11,274,589,537 – 11,274,589,537
Power plant 1,537,222,223 – 1,537,222,223
June 30, 2022 13,379,311,760 262,323,218 13,641,634,978
The above table shows assets recognized at fair value, analyzed between those whose fair value is based on:
– Level 1: quoted prices in active markets for identical assets or liabilities;
– Level 2: those involving Inputs other than quoted prices included in Level 1 that are observable for the asset or
liability, either directly (as prices) or indirectly (derived from prices); and
– Level 3: Inputs for the asset or liability that are not based on observable market data.
101
6.1.4 Had the Company’s freehold land, factory building on freehold land, plant and machinery, power plant and other
machinery and equipment been measured on a historical cost basis, their carrying amount would have been as
follows:
Rupees
2023 2022
- Freehold land 63,325,863 63,325,863

- Factory building on freehold land 79,875,666 55,003,186
- Plant and machinery 10,406,382,678 8,936,172,344
- Power plant 522,529,399 541,481,242
- Other machinery and equipment 21,700,217 –
11,093,813,823 9,595,982,635
6.1.5 Forced sale value as per the last revaluation report as of June 30, 2023 of freehold land, factory building on freehold
land, plant and machinery, power plant and other machinery and equipment and was Rs. 508.480 million, Rs. 248.133
million, Rs. 12,979.456 million, Rs. 1,360.600 million and Rs. 35.000 million and respectively.
6.1.6 Particulars of immovable fixed assets are as follows:
Description: Location: Approx. area of land:

- Manufacturing site 17-KM Sheikhupura Road, Lahore 181.6 kanals
- Warehouses and colony 17-KM Sheikhupura Road, Lahore 122.25 kanals
- Warehouse Badami Bagh, Lahore 7.25 kanals
- Sale centres Badami Bagh, Lahore 3.40 Kanals
- Registered office 31-A Shadman 1, Lahore 1.75 Kanals
Warehouses, colony, sales centres and registered office, represent developments on leasehold lands. Developments
on leasehold lands represent civil / structural improvements.
6.1.7 Title of land measuring 63 kanals and 8 marlas has not yet been transferred in the name of the Company. The said title
is currently in name of Mughal Steel (AoP) which was taken over by the Company.
6.1.8 Detail of charge created on certain items of property, plant and equipment is given in note 23. This charge existed at
June 30, 2023. The Company is not allowed to offer the assets under charge as security for additional borrowings or
to sell them without prior approval of the existing lenders.
6.1.9 Property, plant and equipment includes certain assets held under common ownership under diminishing musharaka
arrangement.
6.1.10 Contractual commitments for the acquisition of property, plant and equipment amounted to Rs.37.700 million as at
June 30, 2023 (2022: Rs. 861.664 million) note 6.2.2.
102
6.1.11 During the previous year, certain items of property, plant and equipment were transferred to assets classified as held
for sale. These assets had been retired from active use and their carrying value was to be recovered through sale
rather than continuing use. Immediately, before transfer, the said assets were remeasured to fair value and impairment
loss of Rs. 53.871 (net of tax) million in respect of plant and machinery (revalued assets) was recognized in other
comprehensive income, whereas, impairment loss in respect of coal gasifier plant (non-revalued asset) of Rs. 3.109
million was recognized in statement of profit or loss account. All these assets related to ferrous segment.
6.1.12 The detail of tangible fixed assets disposed off during the year is as follows:
Rupees Description / Particulars of buyers / Relation Mode of Cost / Net book Net Gain /
with the Company or its Directors disposal revalued amount value proceeds (loss)
Vehicles:
Muhammad Irfan Amin - employee Company policy 1,566,730 856,512 750,000 (106,512)
Rashid Hassan Butt - employee Company policy 1,391,000 614,580 500,000 (114,580)
Chanda Mushtaq - employee Company policy 1,480,000 671,005 1,080,000 408,995
Adil Sajjad - employee Company policy 1,790,100 1,092,281 1,800,000 707,719
Aziz-ul-Rehman - employee Company policy 1,853,500 961,368 725,000 (236,368)
Ijazullah - employee Company policy 2,402,530 2,156,360 2,400,000 243,640
Basit Habib - employee Company policy 6,113,530 3,208,298 4,360,000 1,151,702
Sheikh Irfan Javed - third party Negotiation 20,498,500 6,594,042 30,500,000 23,905,958
Sheikh Irfan Javed - third party Negotiation 18,390,867 5,604,722 30,500,000 24,895,278
June 30, 2023 55,486,757 21,759,168 72,615,000 50,855,832
June 30, 2022 645,740,346 589,519,264 524,667,414 (64,851,850)
6.2 Following is the movement in capital work-in-progress:
Rupees Opening Additions Transfers Closing

Note balance balance
Tangible:
- Payment for land 6.2.1 14,240,625 – – 14,240,625
- Plant, machinery and others 6.2.2 1,631,683,107 1,564,672,010 (1,769,440,363) 1,426,914,754
June 30, 2023 1,645,923,732 1,564,672,010 (1,769,440,363) 1,441,155,379
June 30, 2022 1,067,981,304 1,624,808,799 (1,046,866,371) 1,645,923,732
6.2.1 This represents estimated payment for acquisition of land measuring 7 kanal and 7 marlas deposited in Government
treasury in accordance with the Land Acquisition Act, 1894. The matter is currently pending.
6.2.2 Transfers mainly included recycling plant and pre-fabricated building for non-ferrous plant capitalized during the year.
103
7. INTANGIBLE ASSET
This represents cost of ERP software implementation. It is being amortized on straight line basis over a period of 60
months.
Rupees
2023 2022

As at June 30,
Cost 14,433,110 14,433,110
Accumulated amortization (13,711,459) (10,824,836)
Net book value 721,651 3,608,274

Year ended June 30,
Opening net book value 721,651 3,608,274
Amortization charge (721,651) (2,886,623)
Balance as at June 30, – 721,651

As at June 30,
Cost 14,433,110 14,433,110
Accumulated amortization (14,433,110) (13,711,459)
Net book value – 721,651
7.1 The amortization charge for the year has been allocated to administrative expenses. This was completely amortized
during the year.
Rupees
2023 2022
8. LONG-TERM INVESTMENT IN FINANCIAL ASSETS

Long-term debt instrument - at amortized cost 50,153,187 –
This represents investment in listed, rated, unsecured, privately placed term finance certificates of Soneri Bank Limited
having tenure of 10 years, carrying profit at the rate of 6MK + 1.70% per annum. Since, investment is held by the
Company within a business model whose objective is to collect contractual cash flows which are solely payments of
principal and interest on the principal amount outstanding, therefore, these have been classified as financial assets
measured at amortized cost. As at June 30, 2023, the term finance certificates were rated A+.
9. LONG-TERM LOANS TO EMPLOYEES

(Secured & considered good)
These loans have been provided to employees under the terms of their employment, free of interest, to facilitate
economical purchase of different kinds of vehicles, house construction and for other personal reasons etc. and are
repayable over a period up to 5 years from date of disbursement. Vehicle loans are secured by registration of the said
vehicle in the name of the Company and against security cheques, while other loans are secured against gratuity and
personal guarantees. No amount was provided to the Chief Executive Officer or any of the Directors during the year
ended June 30, 2023 (2022: Rs. Nil). The maximum amount of loans to the key management personnel outstanding
at the end of any month during the year ended June 30, 2023 was Rs. Nil (2022: Rs. Nil).
104
Rupees
2023 2022
Outstanding amount 99,693,973 77,821,708

Amounts due within twelve months and shown under current assets (33,784,181) (26,552,294)
65,909,792 51,269,414
10. LONG-TERM DEPOSITS

These mainly include deposits with utility companies.
11.
INVENTORIES
Stores, spares and loose tools 2,811,602,149 1,920,118,029
Raw material 16,082,208,930 15,386,825,723
Finished goods and waste 4,136,449,387 5,656,027,248
23,030,260,466 22,962,971,000
11.1 Inventories include material in-transit on account of stores, spares and loose tools, raw material and finished goods
amounting to Rs. 50.211 million (2022: Rs. 102.058 million), Rs. 1,117.145 million (2022: Rs. 2,459.191 million) and
Rs. Nil (2022: Rs. 366.386 million) respectively.
11.2 Inventories are under hypothecation of commercial banks as security for facilities in respect of short-term borrowings
(note 30). Inventories amounting to Rs. 929.624 million (2022: 104.364 million) are carried at fair value less costs to
sell.
12. TRADE DEBTS

(Considered good and unsecured)
Trade debts are non-interest bearing and are generally on terms of 30 to 60 days. Information about the Company’s
exposure to credit and market risks for trade debts is included in note 50. Trade debts are under hypothecation of
commercial banks as security for facilities in respect of short-term borrowings (note 30).
Export sales 12.1 1,718,920,765 1,516,907,613

Local sales 7,697,703,052 4,155,710,538
9,416,623,817 5,672,618,151
Allowance for expected credit losses 12.2 (133,477,371) (99,032,518)
9,283,146,446 5,573,585,633
12.1 These represent trade debts outstanding against export sales of Rs. 10,019.770 million (2022: Rs. 12,341.238 million)
made to such parties during the year. The entire sales in respect of these parties was made in the region of People’s
Republic of China. Out of total sales to these parties, Rs. 6,456.586 million (2022: Rs. 12,341.238 million) was made
against LC on sight basis and Rs. 3,563.184 (2022: Rs. Nil) was made on basis of payment against documents. For
aging purposes, the receivables against export sales were neither past due nor impaired. No export sale was made
to any related party during the year nor there were any cases of default on part of any export parties.
105
Rupees
2023 2022
12.2 Movement in allowance for expected credit losses is as follows:

Opening balance 99,032,518 65,556,479
Charge for the year 34,444,853 33,476,039
Closing balance 133,477,371 99,032,518
The allowance for expected credit losses assessment requires a degree of estimation and judgement and is based
on the lifetime expected credit losses, grouped based on days overdue, and makes assumptions to allocate an
overall expected credit loss rate for each group. These assumptions amongst other factors include recent sales
experience, historical collection rates, economic conditions during the period over which the historical data has been
collected, current conditions and the Company’s view of economic conditions over the expected lives of the trade
debts. The management believes that none of the balances are credit impaired nor any further impairment allowance
is necessary in respect of unprovided past due amounts as there are reasonable grounds to believe that the amounts
will be recovered in short course of time.
12.3
Aging of trade debts is as follows:
Not overdue 5,689,148,889 4,097,041,685
Past due:
30 days 1,734,706,247 596,704,867
60 days 1,300,785,316 96,859,314
150 days 415,972,964 18,813,844
Greater than 150 days 276,010,401 863,198,441
9,416,623,817 5,672,618,151
Allowance for expected credit losses (133,477,371) (99,032,518)
9,283,146,446 5,573,585,633
13. LOANS AND ADVANCES

(Considered good)
Current portion of long-term loans to employees 9. 33,784,181 26,552,294

Advances to: 13.1
- Key management personnel 345,000 4,573,000
- Other employees 35,368,350 22,616,872
35,713,350 27,189,872
Advances to suppliers 361,893,034 94,534,790
431,390,565 148,276,956
13.1 These represent interest-free advances provided to employees in accordance with Company policy. These are secured
against salary / gratuity and are repayable within twelve months. The maximum aggregate amount of advances to the
key management personnel outstanding at the end of any month during the year ended June 30, 2023 was Rs. 4.948
million (2022: Rs. 6.673 million). There were no advances which were past due or impaired. No amount was provided
to the Chief Executive Officer or any of the Directors during the year ended June 30, 2023 (2022: Rs. Nil).
106
14.
DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES
Interest accrued on term deposit receipts 18,548,303 4,716,603
Letters of credit 8,054,813 3,061,988
Prepayments 31,118,603 17,091,336
Security deposits against rent 14.1 1,100,000 1,100,000
Deposits 14.2 29,408,644 26,534,318
Margin against guarantees 14.3 528,689,019 133,843,453
Other receivables - considered good 12,601,077 3,410,606
629,520,459 189,758,304
14.1
Due from related parties:
- Al-Bashir (Private) Limited 500,000 500,000
500,000 500,000
The maximum aggregate amount due from related parties outstanding at the end of any month during the year ended
June 30, 2023 was Rs. 0.500 million (2022: Rs. 0.500 million).
14.2 These mainly include pay orders issued to Collector of Customs as security against various import consignments.
14.3 This represents margin against guarantees issued for the supply of steel bars and girders.
15.
DUE FROM THE GOVERNMENT
Sales tax - net 15.1, 15.2 735,697,445 142,870,332
Advance income tax - net 15.3 2,802,911,314 2,255,973,571
Custom duties 15.4 223,043,232 103,826,958
Export regulatory duty - considered doubtful 15.5 – –
3,761,651,991 2,502,670,861
15.1 This includes Rs. 103.292 million (2022: Rs. 103.292 million) outstanding on account of alleged sales tax liability
recovered against order of the Additional Commissioner, Punjab Revenue Authority (PRA) on the basis of presumed
non-withholding of sales tax in respect of various taxable services. However, the management and the Company’s
legal advisor were strongly of the opinion that there was no non-compliance of any provisions of the PRA or rules
made thereunder and that the said order and recovery was illegal and violative of the fundamental rights, against
the factual position and without the support of law and that the charges therein were based on the misconception
of the department. Accordingly, against the said order of the Additional Commissioner, appeal dated May 09, 2018
was filed before the Commissioner (Appeals), whereby the Additional Commissioner was directed to initiate enquiry
and address the grievances of the Company. The Additional Commissioner submitted the enquiry report to the
Commissioner (Appeals). The Commissioner (Appeals) passed order in favor of the Company by partially deleting the
demand to the extent of Rs. 27.495 million whereas the remaining amount of Rs. 75.797 million was set aside. The
set aside proceedings were concluded, whereby, the demand of Rs. 75.797 million was sustained by the Additional
Commissioner. The Company again filed appeal before the Commissioner (Appeals) against the said order. The
hearings have been concluded, however, the order is awaited till date. The management is rigorously contesting the
case and along with the Company’s legal advisor are optimistic that the ultimate outcome of this case will be in favor
of the Company.
107
15.2 This includes an amount of Rs. 80.783 million deposited under protest against a demand of Rs. 398.945 raised by
the Customs authorities on account of sales tax, whereby the Customs authorities recalculated the value of supply of
local waste generated from non-ferrous segment, in accordance with the valuation rulings issued under the Customs
Act, 1969, despite of the fact that in case of local supply, the said value was to be determined keeping view the
provisions of section 2(46) of the Sales Tax Act, 1990, and that valuation rulings issued under the Customs Act, 1969,
were applicable only in case of imports and not in case of local supplies. The matter is currently pending before
the Collector Adjudication. The Company and its legal advisor are of the opinion that the said demand is not legally
justified and hence refundable / adjustable.
Rupees
2023 2022
15.3
Advance income tax - net
Opening balance 2,255,973,571 1,880,561,668
Payments 858,880,186 776,564,037
3,114,853,757 2,657,125,705
Adjustments (311,942,443) (401,152,134)
Closing balance 2,802,911,314 2,255,973,571
15.4 This represents payments made under protest on account of regulatory and additional custom duty in respect of sale
of local waste generated from non-ferrous segment against demand created by the Customs authorities, despite the
fact that regulatory duty and additional custom duty are not applicable on material imported under manufacturing
bond scheme. The Company and its legal advisor are of the opinion that the said demand is not legally justified and
hence refundable / adjustable.
Rupees
2023 2022
15.5
Export regulatory duty - considered doubtful:
Export regulatory duty 54,148,408 54,148,408
Provision for doubtful recovery (54,148,408) (54,148,408)
– –
Government of Pakistan (GoP) imposed regulatory duty on export of scrap and steel products with the objective to
protect the local steel industry. This duty was not applicable in respect of goods manufactured and exported from
raw material imported under the Duty and Tax Remission Scheme (DTRE) or in manufacturing bonded warehouses.
However, the Company under protest deposited the regulatory duty to clear the export consignments at that time. This
fact is also evident from the subsequent withdrawal of duty by Federal Board of Revenue (FBR) from exports made
out of finished goods manufactured from raw material imported in manufacturing bonded warehouses or under DTRE
regime. The matter is currently pending before the Customs Appellate Tribunal and due to uncertainty in respect of
recovery, provision has been recorded.
16.
CASH AND BANK BALANCES
Balances with banks in:
- Current accounts 16.1 1,956,666,671 2,783,562,418
- Saving accounts 16.2 280,338,557 267,447,954
- Term deposits 16.3 648,085,000 2,122,500,000
2,885,090,228 5,173,510,372
Cash in hand 36,642 2,124,214
2,885,126,870 5,175,634,586
108
16.1 Includes US$ 341,490 (2022: US$ 469,530).
16.2 These include an amount of Rs. 123.394 million (2022: Rs. 101.719 million) maintained in an account over which lien
is marked in favor of sukuk holders. The said amount can only be utilized for purpose of payments to sukuk holders
as and when due. These carried profit ranging between 13.50% to 20.50% (2022: 5.8% to 12%) per annum.
16.3 These carried profit ranging between 13.50% to 19.50% (2022: 11.00% to 15.25%) per annum.
17. ASSETS CLASSIFIED AS HELD FOR SALE

These represented certain items of property, plant and equipment comprising of plant and machinery and coal gasifier
plant, which had been retired from active use and their carrying value was to be recovered through sale rather than
continuing use and were transferred to assets classified as held for sale during the quarter ended December 31, 2021.
These assets related to ferrous segment and were sold during the quarter ended March 31, 2022.
Rupees
2023 2022
17.1 Movement in assets classified as held for sale:

Opening balance – –
Assets transferred during the year – 489,743,590
Assets sold during the year – (489,743,590)
Closing balance – –
18. AUTHORIZED SHARE CAPITAL

This represents 500,000,000 (2022: 500,000,000) ordinary shares of Rs. 10/- each.
19. ISSUED, SUBSCRIBED AND PAID-UP CAPITAL

This represents 335,633,933 (2022: 335,633,933) ordinary shares of Rs. 10/- each. The holders of ordinary shares are
entitled to receive dividends as declared from time to time and are entitled to one vote per share at general meetings
of the Company. All shares rank equally with regard to Company’s residual assets. Break-up of issued, subscribed
and paid-up capital is as follows:
2023 2022 2023 2022

Number of shares Note Rupees
202,207,479 202,207,479 Shares allotted for consideration paid in cash 2,022,074,790 2,022,074,790
58,579,553 58,579,553 Shares allotted for consideration other than cash 19.1 585,795,530 585,795,530
74,846,901 74,846,901 Shares allotted as bonus shares 19.2 748,469,010 748,469,010
335,633,933 335,633,933 3,356,339,330 3,356,339,330
19.1 These represent shares issued against purchase of business comprising of net assets of Mughal Steel (AoP) including
fixed assets.
109
19.2 Movement in shares allotted as bonus shares:
2023 2022 2023 2022

Number of shares Rupees
74,846,901 31,068,562 Opening balance 748,469,010 310,685,620

Issue of 43,778,339 ordinary shares of Rs. 10/- each
– 43,778,339 as fully paid-up bonus shares @ 15% – 437,783,390
74,846,901 74,846,901 Closing balance 748,469,010 748,469,010
19.3 213.595 million ordinary shares (2022: 216.894 million) of Rs. 10/- each were held by major shareholders, key
management personnel and their relatives.
19.4 Pursuant, to covenants contained in the financing agreements, the Company is prevented from declaring dividend, if
such declaration leads to breach of any financial covenants stipulated therein.
Rupees
2023 2022
20. SHARE PREMIUM ACCOUNT
Share premium account 2,324,952,020 2,324,952,020
This represents reserve on account of share premium charged in respect of issuance of ordinary shares in previous
years. This reserve can be utilized by the Company only for the purposes specified in Section 81 of the Companies
Act, 2017.
Rupees
2023 2022
20.1 Movement in share premium account:

Opening balance 2,324,952,020 2,762,735,410
Utilization of share premium account for issuance of 15%
bonus shares – (437,783,390)
Closing balance 2,324,952,020 2,324,952,020
21. This represents contingency reserve set aside from un-appropriated profit for meeting future catastrophic events.
22. REVALUATION SURPLUS ON PROPERTY,

PLANT AND EQUIPMENT
Revaluation surplus on property, plant and equipment 22.1 3,998,378,178 3,018,133,793
110
Rupees
2023 2022
22.1 Movement in revaluation surplus on property,

plant and equipment:
Opening balance 3,018,133,793 3,402,244,904
Recognized during the year 1,396,289,705 –
Transferred to other comprehensive income on
account of impairment loss – (53,871,350)
Transferred to un-appropriated profits on account of:
- Disposal of property, plant and equipment – (252,004,116)
- Incremental depreciation for the year (61,966,495) (78,235,645)
- Effect of change in effective tax rate (354,078,825) –
Closing balance 3,998,378,178 3,018,133,793
22.2
Breakup of revaluation surplus net of deferred tax is as follows:
Freehold land 572,274,137 504,174,137
Factory building on freehold land 140,456,018 147,171,360
Plant and machinery 2,553,748,610 1,659,950,831
Power plant 718,599,630 706,837,465
Other machinery and equipment 13,299,783 –
3,998,378,178 3,018,133,793
22.3 The revaluation surplus on property, plant and equipment is not available for distribution to the shareholders in
accordance with section 241 of the Companies Act, 2017.
23.
LONG-TERM FINANCING - SECURED
Long-term loans 23.1 2,333,310,665 1,687,346,898
Diminishing musharaka 23.2 437,042,917 708,494,719
Shariah compliant sukuk certificates 23.3 2,210,124,312 2,913,340,269
4,980,477,894 5,309,181,886
Current portion shown under current liabilities (1,678,411,215) (1,281,336,412)
3,302,066,679 4,027,845,474
23.1
Long term loans:
Bank Alfalah Limited - II 23.1.1 39,500,000 59,250,000
Bank Alfalah Limited - III 23.1.2 – 34,885,061
Bank Alfalah Limited - IV 23.1.3 79,263,135 117,137,552
Soneri Bank Limited - I 23.1.4 39,106,767 44,454,332
Soneri Bank Limited - II 23.1.5 28,864,000 33,040,000
United Bank Limited 23.1.6 76,190,476 152,380,953
Habib Bank Limited - I 23.1.7 221,901,000 233,580,000
Habib Bank Limited - II 23.1.8 1,848,485,287 1,012,619,000
2,333,310,665 1,687,346,898
Current portion shown under current liabilities: (576,372,118) (195,742,065)
1,756,938,547 1,491,604,833
111
23.1.1 This represents outstanding amount in respect of term finance facility obtained for the purpose of financing various
items of plant and machinery and related civil work for ferrous segment. It is repayable in 16 equal quarterly installments,
with the last installment due in May 2025. It carries mark up at the rate of 3MK + 1.25% per annum.
23.1.2 It was completely repaid during the year.
23.1.3 This represents outstanding amount in respect of term finance facility obtained for the purpose of financing plant and
machinery for ferrous segment availed under State Bank of Pakistan temporary refinance scheme. It is repayable
in 16 equal quarterly installments with last installment due in May 2025. It carries mark up at SBP rate + 3.00% per
annum. The fair value of the loan has been determined by discounting the loan proceeds using prevailing market
rates of interest for similar instruments. The differential between the loan proceeds and fair value of the loan has been
recorded as deferred grant (note 4.22 and 26).
23.1.4 This represents outstanding amount in respect of term finance facility obtained for the purpose of financing procurement
and installation of solar system. It is repayable in 120 equal monthly installments with last installment due in November
2031. It carries mark up at the rate of 3MK + 2.00% per annum.
23.1.5 This represents outstanding amount in respect of SBP scheme for renewable energy facility obtained for the purpose
of financing procurement and installation of solar system. It is repayable in 120 equal monthly installments with last
installment due in May 2030. It carries mark up at SBP rate + 3.00% per annum.
23.1.6 This represents outstanding amount in respect of demand finance facility obtained for the purpose of financing plant
and machinery and related civil works for ferrous segment. It is repayable in 21 equal quarterly installments, with the
last installment due in May 2024. It carries mark up at the rate of 3MK + 0.80% per annum.
23.1.7 This represents outstanding amount in respect of SBP scheme for LTFF obtained for the purpose of financing imported
plant and machinery for non-ferrous segment. It is repayable in 20 equal quarterly installments, post completion of
grace period of 12 months, with last installment due in March 2028. It carries mark up at SBP rate + 1% per annum.
23.1.8 This represents outstanding amount in respect of term finance obtained for the purpose of financing imported plant
and machinery for non-ferrous segment and certain spares for ferrous segment. It is repayable in 20 equal quarterly
installments, post completion of grace period of 12 months, with last installment due in June 2028. It carries mark up
at the rate of 3MK + 1% per annum.
23.2
Diminishing musharaka:
Askari Bank Limited - I 23.2.1 87,500,000 175,000,000
Askari Bank Limited - II 23.2.2 – 38,917,073
Habib Metropolitan Bank Limited 23.2.3 87,500,000 175,000,000
Meezan Bank Limited - I 23.2.4 127,020,169 184,021,420
Meezan Bank Limited - II 23.2.5 135,022,748 135,556,226
437,042,917 708,494,719
Current portion shown under current liabilities (247,992,663) (271,451,802)
189,050,254 437,042,917
23.2.1 This represents outstanding amount in respect of diminishing musharaka obtained for the purpose of financing
various items of plant and machinery for ferrous segment. It is repayable in 16 equal quarterly installments, with the
last installment due in April 2024. It carries mark up at the rate of 3MK + 0.90% per annum.
112
23.2.2 It was completely repaid during the year.
23.2.3 This represents outstanding amount in respect of diminishing musharaka facility obtained for the purpose of financing
imported machinery for ferrous segment. It is repayable in 16 equal quarterly installments, with the last installment due
in April 2024. It carries mark up at the rate of 3MK + 0.80% per annum.
23.2.4 This represents outstanding amount in respect of diminishing musharaka facility obtained for the purpose of financing
plant and machinery for ferrous segment. It is repayable in 16 equal quarterly installments, with the last installment due
in March 2026. It carries mark up at the rate of 3MK + 1% per annum.
23.2.5 This represents outstanding amount in respect of Islamic temporary refinance facility obtained for purchase of plant
and machinery for ferrous segment. It is repayable in 32 equal quarterly installments, with the last installment due
in June 2031. It carries mark up at SBP rate + 4% per annum. The fair value of the loan has been determined by
discounting the loan proceeds using prevailing market rates of interest for similar instruments. The differential between
the loan proceeds and fair value of the loan has been recorded as deferred grant (note 4.22 and 26).
23.3
Shariah compliant sukuk certificates:
Sukuk I - (diminishing musharaka) 23.3.1 2,210,124,312 2,913,340,269
Current portion shown under current liabilities (854,046,434) (814,142,545)
1,356,077,878 2,099,197,724
This represents the amortized cost of 3,000 privately placed, rated, secured, OTC listed Shariah compliant sukuk
certificates aggregating to Rs. 3,000.000 million (inclusive of a green shoe option of Rs, 1,000.000 million) having face
value of Rs. 1,000,000/- each, issued for a period of 5 years (inclusive of 1 year grace period) to Qualified Institutional
Buyers (QIBs) in accordance with Section 66 of the Companies Act, 2017 for the purpose of meeting working capital
requirements of the Company and utilized accordingly. These carry mark up at the rate of 3MK + 1.30% per annum
and are repayable in 16 equal quarterly installments, with the last installment due in April 2025. Pakistan Credit Rating
Agency Limited (PACRA) and VIS Credit Rating Company Limited (VIS) as per their latest reports have assigned long-
term rating of A+ to the sukuk certificates.
23.4 The above outstanding facilities are secured by joint pari passu charge to the extent of Rs. 9,562.906 million (2022:
9,562.906 million) over present and future fixed assets (excluding land and building) of the Company with 25% margin
and by way of personal guarantees of Directors, other than Independent Directors. In addition the Company is also
required to comply with certain financial covenants including but not limited to prohibition with respect to payment of
dividend until certain financial requirements are satisfied.
Rupees
2023 2022
24.
DEFERRED TAXATION
Net deferred tax liability is recognized in respect of
following taxable / (deductible) temporary differences:
- Accelerated tax depreciation 2,199,427,327 1,530,173,118
- Revaluation surplus on property, plant and equipment 1,916,478,351 1,026,828,593
- Defined benefit obligation (189,161,842) (116,388,017)
- Allowance for expected credit losses (41,993,203) (24,633,954)
- Tax losses (5,655,687) –
3,879,094,946 2,415,979,740
113
24.1 Movement in the net deferred tax liability is as follows:
Rupees Recognized during the year in

Opening balance Statement of profitOther comprehensive Closing balance
or loss income / Equity
Accelerated tax depreciation 1,530,173,118 669,254,209 – 2,199,427,327

Revaluation surplus on property,
plant and equipment 1,026,828,593 (39,617,924) 929,267,682 1,916,478,351
Defined benefit obligation (116,388,017) (74,475,782) 1,701,957 (189,161,842)
Allowance for expected credit losses (24,633,954) (17,359,249) – (41,993,203)
Tax losses – (5,655,687) – (5,655,687)
June 30, 2023 2,415,979,740 532,145,567 930,969,639 3,879,094,946
Accelerated tax depreciation 1,344,372,743 185,800,375 – 1,530,173,118

Revaluation surplus on property,
plant and equipment 1,183,719,047 (134,886,663) (22,003,791) 1,026,828,593
Defined benefit obligation (82,821,050) (30,312,705) (3,254,262) (116,388,017)
Allowance for expected credit losses (15,938,125) (8,695,829) – (24,633,954)
Provisions (2,446,919) 2,446,919 – –
Minimum tax and tax losses (375,519,981) 375,519,981 – –
June 30, 2022 2,051,365,715 389,872,078 (25,258,053) 2,415,979,740
Deferred tax assets and liabilities on temporary differences are measured at 39% (2022: 29%). Deferred tax asset
is recognized for tax losses, minimum tax, alternative corporate tax, and tax losses available for carry forward, if,
the realization of the related tax benefit through future taxable profits is probable. Deferred tax asset on tax credit
representing minimum tax available for carry forward under section 113 of the Income Tax Ordinance, 2001 has not
been recognized as sufficient taxable profits would not be available for adjustment / utilization in the foreseeable
future. The minimum tax would expire as follows:
Rupees Accounting year to Amount of Accounting year in

which minimum minimum which minimum tax
tax relates tax will expire
2023 343,788,815 2026
25. DEFINED BENEFIT OBLIGATION

Defined benefit obligation 24.1 601,259,811 467,898,836
25.1 This represents the present value of the defined benefit obligation recognized in the statement of financial position
(note 4.5). The latest actuarial valuation was carried out on June 30, 2023 using Projected unit credit (PUC) method by
an approved actuary. It includes Rs. 83.392 million (2022: Rs. 55.858 million) on account of present value of defined
benefit obligation of key management personnel. The Company does not have any plan assets covering its defined
benefit obligation.
114
Rupees
2023 2022
25.2
Changes in net liability recognized in statement of financial position:
Opening balance 467,898,836 357,573,653
Expense charged to statement of profit or loss 169,312,697 122,861,112
Remeasurements recognized in other comprehensive income (4,363,993) 11,221,594
632,847,540 491,656,359
Defined benefits paid (31,587,729) (23,757,523)
601,259,811 467,898,836
25.3 Changes in present value of defined benefit obligation:

Opening value of obligation 467,898,836 357,573,653
Current service cost 111,157,767 88,985,159
Interest cost 58,154,930 33,875,953
Remeasurements of obligation:
- Actuarial loss from changes in financial assumptions 4,468,126 4,089,203
- Experience adjustments (8,832,119) 7,132,391
Defined benefits paid (31,587,729) (23,757,523)
Present value of defined benefit obligation as at June 30, 601,259,811 467,898,836
25.4
Expense charged to statement of profit or loss:
Current service cost 111,157,767 88,985,159
Interest cost 58,154,930 33,875,953
169,312,697 122,861,112
The expense charged to statement of profit or loss includes Rs. 24.291 million (2022: Rs. 14.870 million) in respect of
key management personnel.
Rupees
2023 2022
25.5
Remeasurements charged to other comprehensive income:
Actuarial loss from changes in financial assumptions 4,468,126 4,089,203
Experience adjustments (8,832,119) 7,132,391
(4,363,993) 11,221,594
25.6
Function-wise breakup of expense charged to statement of profit or loss:
Cost of sales 110,132,030 77,226,984
Sales and marketing expenses 2,621,022 3,510,317
Administrative expenses 56,559,645 42,123,811
169,312,697 122,861,112
115
Rupees
2023 2022
25.7
Key actuarial assumptions used:
Discount rate used for interest cost in profit or loss charge (%) 13.25% 10.00%
Discount rate used for year end obligation (%) 16.25% 13.25%
Future salary increased (%) 15.25% 12.25%
Next salary increase 01-Jul-23 01-Jul-22
Pre-retirement mortality SLIC 2001-2005
Set back 1 year
Withdrawal rates Age based
Retirement assumption Age 60
Actuarial valuation method used Projected unit credit (PUC)
method
Figures in this note are based on the latest actuarial valuation carried out as at June 30, 2023.
25.8 Sensitivity analysis for actuarial assumptions
The sensitivity of the defined benefit obligation to changes in the weighted principle assumptions is:
Rupees Change in Increase in Decrease in

assumption assumption assumption
Discount rate +- by 100 bps 534,308,932 636,546,874

Salary increase +- by 100 bps 637,635,698 532,571,326
There is no significant change in the obligation if the life expectancy increases by 1 year.
The sensitivity analysis are based on a change in an assumption while holding all other assumptions constant. In
practice, this is unlikely to occur, and changes in some of the assumptions may be correlated.
Based on actuary’s advice, the amount of expected liability in respect of the defined benefit plan in 2023-24 will be Rs.
217.499 million.
The average duration of the defined benefit obligation is 9 years.
25.9 Experience adjustments in respect of defined benefit obligation:
Rupees FY 2019 FY 2020 FY 2021 FY 2022 FY 2023
24,750,508 (36,249,761) 34,080,673 7,132,391 (8,832,119)
25.10 Expected benefit payments for the next 6 years and beyond:
Rupees FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 FY 2030 and

onwards
93,741,441 61,845,801 112,710,573 92,256,061 83,908,335 95,918,806 49,754,352,425
116
26.
DEFERRED LIABILITIES
Deferred income 26.1 67,144,905 49,791,235
Deferred grant 26.2 17,868,455 25,538,866
85,013,360 75,330,101
26.1 This represents unrecognized sale proceeds in respect of long-term loans to employees against vehicles.
26.2 This represents the non-current portion of the deferred grant recognized (note 4.22). Deferred grant amounting to Rs.
7.670 million (2022: Rs. 21.371 million) was amortized during the year.
27.
TRADE AND OTHER PAYABLES
Creditors 1,298,726,860 1,356,737,951
Accrued and other liabilities 200,885,728 191,922,790
Utilities payable 27.1 1,044,301,279 511,535,453
Withholding taxes payable 60,621,348 17,639,969
Contract liabilities (Running account with customers) 27.2 79,641,552 284,779,489
Workers’ profit participation fund payable 27.3 233,598,643 336,093,118
Workers’ welfare fund payable 88,701,984 224,980,733
3,006,477,394 2,923,689,503
27.1 This includes Rs. 591.131 million (2022: Nil) on account of Fuel Price Adjustment (FPA) and Quarterly Tariff Rate
Adjustment (QTR) charged in electricity bills for the period relating from July 2022 to December 2022, against which
writ petitions were filed before the Honourable Lahore High Court, whereby stay was granted in favor of the petitioners.
However, LESCO has filed intra-court appeal against the order which is still pending in the Honourable Lahore High
Court.
27.2 These are unsecured and represented advance payments received from customers against which goods are to be
supplied.
27.3
Workers’ profit participation fund payable:
Opening balance 336,093,118 223,495,586
Allocation for the year 37. 233,598,643 336,093,118
569,691,761 559,588,704
Interest charge 53,360,169 –
Payments (389,453,287) (223,495,586)
Closing balance 233,598,643 336,093,118
28. This represents unclaimed and unpaid dividend amounts and includes amount of Rs. 5.255 million (2022: Rs. 4.577
million) on account of unclaimed / unpaid dividend outstanding for more than three years.
117
29.
ACCRUED PROFIT / INTEREST / MARK-UP
Payable in respect of:
- Long-term financing 136,956,112 34,556,501
- Short-term borrowings 752,802,100 345,312,592
889,758,212 379,869,093
30.
SHORT-TERM BORROWINGS
Short-term borrowings availed from: 30.1
- Islamic banks - secured 8,858,844,100 9,321,707,679
- Conventional banks - secured 10,304,753,595 9,265,108,351
19,163,597,695 18,586,816,030
Commercial paper - I - unsecured 30.2 – 2,019,947,376

Commercial paper - II - unsecured 30.3 1,831,448,598 –
1,831,448,598 2,019,947,376
20,995,046,293 20,606,763,406
Temporary bank overdraft 30.4 – 12,182,111
20,995,046,293 20,618,945,517
30.1 Short-term borrowings have been obtained from various conventional and Islamic banks under mark-up / profit
arrangements for meeting various working capital requirements. The aggregate credit facilities available to the
Company other than under trade credit amounted to Rs. 37,713.000 million (2022: Rs. 38,354.714 million) which
represent the aggregate of all facility agreements between the Company and respective banks in respect of funded
and non-funded facilities. Out of the total available facilities, Rs. 6,712.754 million (2022: Rs. 8,104.791 million)
remained unavailed as at June 30, 2023. Funded facilities include various facilities comprising of running finance,
cash finance, karobar finance, running musharaka, istisna, wakala and other import credit facilities which can be
used interchangeably. Unfunded facilities represent facilities for opening letters of credit and guarantees. Majority of
the funded facilities are sublimits of unfunded facilities. The facilities are secured by ranking / pari passu / joint pari
passu charges over present and future current assets of the Company, pledge of stocks, lien over documents, title of
ownership of goods imported under letters of credit, lien over EE statements, against trust receipts duly executed in
favor of banks and personal guarantees of the Directors except for Independent Directors and carry mark-up at the
rates ranging from SBP / 1MK to 6MK rate + 0.50% to 1.50% (2022: SBP / 1MK to 6MK rate + 0.50% to 1.00%) per
annum.
30.2 This represented Shariah compliant, privately placed and unsecured Islamic Commercial Paper (ICP) of 360 days
tenor. This carried profit at the rate of 6MK + 1.75% per annum. It was completely repaid during the year upon its
maturity.
30.3 This represents privately placed and unsecured conventional Commercial Paper (ICP) of 270 days tenor issued during
the year. The proceeds therefrom were utilized to finance the Company’s working capital requirements. This carries
profit at the rate of 6MK + 1.50% per annum.
30.4 This represents temporary overdraft due to cheques issued by the Company at the reporting date to be met with
subsequent deposits.
118
31. SHORT-TERM LOANS FROM DIRECTORS - UNSECURED
This represented interest-free and unsecured loans from Directors and were repayable upon demand. These loans
were provided and utilized for meeting working capital requirements.
32. CONTINGENCIES AND COMMITMENTS

Contingencies:
Guarantees:
i) The members of the Company vide their extraordinary general meeting held on April 19, 2021, have
authorized the Company to issue corporate guarantee limit to a maximum of Rs. 6,000.000 million in favor of
banks on behalf of Mughal Energy Limited (related party), for the purpose of availing financing for a period
of 5 years.
ii) Aggregate amount of guarantees issued by banks / insurance companies on behalf of the Company in the
normal course of the business amounted to Rs. 3,418.704 million (2022: Rs. 2,848.462 million).
Claims subject to legal proceedings:

The details of claim by and against the Company witch are currently subject to the legal proceedings are detail below.
S. No Name of the Particulars of the case Principal Date

court, agency parties instituted
or authority
i) Honourable The Additional Commissioner Inland Revenue Company and June 02, 2017
Lahore High (ACIR) passed an amended assessment order u/s Federal Board
Court 122(1)/122(5A) of the Income Tax Ordinance, 2001 for of Revenue
Tax Year 2013 creating demand of Rs. 198.484 million.
The Company filed appeal before Commissioner Inland
Revenue Appeals (CIR-A). However, CIR-A maintained
the order of the ACIR. The Company subsequently filed
an appeal before Appellate Tribunal Inland Revenue
(ATIR) which was accepted. However, the department
filed reference before the Honourable Lahore High
Court which is pending adjudication. No provision has
been made in these financial statements as both the
management and the Company’s legal advisor are
optimistic that the ultimate outcome of this case will be
in favor of the Company.
ii) Honourable Writ petition has been filed before the Honourable Company and June 22, 2016
Lahore High Lahore High Court against demand of Rs. 1.581 million Federation of
Court on account of Punjab Infrastructure Development Pakistan
Cess on import of goods in Punjab. The Company has
challenged the constitutionality of Punjab Infrastructure
Development Cess Act, 2015. No provision has
119

or authority
iii) Federal Board The Deputy Commissioner Inland Revenue (DCIR) Company and November 15,
of Revenue passed an assessment order creating demand of Rs. Federal Board 2018
10.319 million on the basis that the Company had not of Revenue
charged further sales tax on supplies made during 2013
to 2016 to unregistered persons. The Company has filed
appeal before Commissioner Inland Revenue Appeals
(CIR-A) on the basis that the adjudicating officer has
unlawfully charged further tax by ignoring the fact, that
the Company is operating under Chapter XI of Sales
Tax Special Procedure Rules, 2007 for payment of sales
tax. The Company has also deposited the impugned
amount under protest. The CIR-A decided the matter
by dismissing the demand and remanded the case
back to the Officer Inland Revenue (OIR). No provision
has been made in these financial statements as both
the management and the Company’s legal advisor are
iv) Honourable The Deputy Commissioner Inland Revenue (DCIR) Company and July 01, 2021
Lahore High initiated audit proceedings u/s 177 of the Income Tax Federal Board
Court Ordinance, 2001 for the Tax Year 2004, creating demand of Revenue
of Rs. 14.196 million against which appeal was filed
before Commissioner Inland Revenue - Appeals (CIR-A)
who decided the case in favor of the Company. However,
the department filed appeal before the Appellate Tribunal
Inland Revenue (ATIR) whereby the ATIR maintained
the order by passed by the CIR-A. The department has
filed reference before the Lahore High Court which is
pending till date. No provision has been made in these
financial statements as both the management and the
Company’s legal advisor are optimistic that the ultimate
outcome of this case will be in favor of the Company.
v) Appellate Appeal filed before Commissioner Inland Revenue - Company and July 09, 2020
Tribunal Inland Appeals (CIR-A) against demand of Rs. 44.795 million Federal Board
Revenue (ATIR) raised u/s 4B of the Income Tax Ordinance, 2001 for the of Revenue
Tax Year 2017, was decided in favor of the Company,
against which, the department had filed appeal before
the Appellate Tribunal Inland Revenue (ATIR). ATIR
decided the matter in favor of the Company, however, no
reference has been filed by the department against the
order of the ATIR. No provision has been made in these
financial statements as both the management and the
Company’s legal advisor are optimistic that the ultimate
outcome of this case will be in favor of the Company.
120
or authority
vi) Commissioner Appeal was filed before Commissioner Inland Revenue Company and February 25,
Inland Revenue - Appeals (CIR-A) against addition of Rs. 53.917 million Federal Board 2023
- Appeals made u/s 122(5A) of the Income Tax Ordinance, 2001 of Revenue
(CIR-A) on account of disallowance of expenses for the Tax
Year 2020 which is currently pending. No provision
has been made in these financial statements as both
the management and the Company’s legal advisor are
vii) Commissioner The Deputy Commissioner Inland Revenue (DCIR) Company and February 25,
Inland Revenue initiated audit proceedings u/s 177 of the Income Tax Federal Board 2023
- Appeals Ordinance, 2001 for the Tax Year 2018, creating demand of Revenue
(CIR-A) of Rs. 251.522 million against which appeal has been
filed before Commissioner Inland Revenue - Appeals
(CIR-A), which is currently pending. No provision has
viii) Commissioner The Deputy Commissioner Inland Revenue (DCIR) Company and July 11, 2023
Inland Revenue initiated proceedings u/s 161 of the Income Tax Federal Board
- Appeals Ordinance, 2001 for the Tax Year 2022, creating demand of Revenue
(CIR-A) of Rs. 49.285 million against which appeal has been
subsequently filed before Commissioner Inland Revenue
- Appeals (CIR-A), which is currently pending. No
provision has been made in these financial statements
as both the management and the Company’s legal
advisor are optimistic that the ultimate outcome of this
case will be in favor of the Company.
ix) Appellate The Deputy Commissioner Inland Revenue (DCIR) Company and August 17,
Tribunal Inland initiated proceedings u/s 11 of the Sales Tax Act, 1990, Federal Board 2023
Revenue (ATIR) whereby demand of Rs. 30,418,929/- was created on of Revenue
account of late deposit of monthly sales tax liability. The
Company filed appeal before the Commissioner Inland
Revenue - Appeals (CIR-A) who upheld the order passed
by the DCIR. The Company has subsequently filed
appeal before the Appellate Tribunal Inland Revenue
(ATIR) which is pending. No provision has been made
in these financial statements as both the management
and the Company’s legal advisor are optimistic that
the ultimate outcome of this case will be in favor of the
Company.
121
Rupees
2023 2022
Commitments:
i) Non-capital commitments 8,391,875,445 6,458,594,758
ii) Capital commitments
- Local – 110,974,000
- Foreign 37,700,000 861,664,257
33.
SALES - net
Local sales 59,812,469,607 60,290,250,077
Export sales 15,041,590,753 13,763,038,779
Trading sales 1,638,847,791 1,590,437,615
76,492,908,151 75,643,726,471
- Commission (10,972,567) (498,318,980)

- Sales tax (9,091,764,821) (8,992,599,836)
(9,102,737,388) (9,490,918,816)
67,390,170,763 66,152,807,655
33.1 All goods are transferred at point of time. Revenue recognized during the year from contract liabilities as at the
beginning of the year amounted to Rs. 261.871 million. During the year, the rate of sales tax was increased from 17%
to 18%.
33.2 Reconciliation with segment information is as follows:
Rupees Ferrous Non- Ferrous Total
Net revenue from external customers:

- Local sales 45,616,934,545 5,342,443,847 50,959,378,392
- Export sales – 15,041,590,753 15,041,590,753
- Trading sales 1,389,201,618 – 1,389,201,618
June 30, 2023 47,006,136,163 20,384,034,600 67,390,170,763
Rupees Ferrous Non- Ferrous Total
- Local sales 46,859,939,168 4,665,737,747 51,525,676,915

- Export sales – 13,267,782,352 13,267,782,352
- Trading sales 1,359,348,388 – 1,359,348,388
June 30, 2022 48,219,287,556 17,933,520,099 66,152,807,655
122
34.
COST OF SALES
Opening stock of finished goods 5,656,027,248 1,564,891,690
Cost of goods manufactured
- Raw material consumed 34.1 46,732,183,191 50,517,045,026
- Salaries, wages and other benefits 34.2 1,318,272,984 1,118,068,305
- Stores, spares and loose tools consumed 1,304,078,293 1,420,494,058
- Fuel and power 6,035,848,208 6,416,506,246
- Repair and maintenance 1,052,000 1,045,541
- Other manufacturing expenses 403,515,013 235,362,930
- Depreciation 6.1.1 404,615,323 389,246,909
56,199,565,012 60,097,769,015
Closing stock of finished goods and waste (4,136,449,387) (5,656,027,248)
Cost of goods sold - manufacturing 57,719,142,873 56,006,633,457
Cost of sales - trading – 18,286,619
57,719,142,873 56,024,920,076
34.1
Raw material consumed:
Opening stock of raw material 12,927,633,914 7,876,473,404
Purchases - net 48,769,613,325 55,568,205,536
61,697,247,239 63,444,678,940
Closing stock of raw material (14,965,064,048) (12,927,633,914)
46,732,183,191 50,517,045,026
34.1.1 Raw material consumed includes Rs. 1,220.008 million (2022: Rs. 1,271.244 million) on account of cost of raw material
sold during the year.
34.2 This includes Rs. 110.132 million (2022: Rs. 77.227 million) in respect of defined benefit obligation.
35.
SALES AND MARKETING EXPENSES
Salaries and other benefits 35.1 44,778,098 40,624,032
Advertisement and sales promotion 70,230,612 152,475,487
Freight, clearing and handling 28,406,941 41,206,575
Travelling 2,610,880 349,580
Insurance 9,103,275 10,105,197
Inspection – 854,090
155,129,806 245,614,961
35.1 This includes Rs. 2.621 million (2022: Rs. 3.510 million) in respect of defined benefit obligation.
123
36.
ADMINISTRATIVE EXPENSES
Directors’ remuneration and benefits 36.1 72,491,536 51,627,990
Salaries and other benefits 36.1 449,642,751 515,650,481
Travelling and conveyance 10,624,933 5,010,832
Postage, telephone and fax 3,686,984 4,556,598
Printing, stationery and publication 3,232,000 3,192,104
Legal and professional charges 1,034,500 1,401,000
Fee and subscription 41,044,043 32,431,190
Rent, rates and taxes 4,836,178 4,800,400
Repair and maintenance 87,991 405,289
Computers and website maintenance 5,666,938 3,773,938
Vehicle running and maintenance 136,423 383,212
Utilities 34,148,403 20,982,918
Insurance 2,585,997 1,610,767
Amortization 7. 721,651 2,886,623
Depreciation 6.1.1 52,145,842 56,227,501
682,086,170 704,940,843
36.1 This includes aggregate of Rs. 56.559 million (2022: Rs. 42.123 million) in respect of defined benefit obligation.
36.2 Amount of Rs. 0.120 million (2022: Rs. 1.447 million) was paid during the year on account of fee to Shariah Advisors.
37.
OTHER CHARGES
Auditors’ remuneration 37.1 3,024,000 1,280,000
Workers’ profit participation fund 233,598,643 336,093,118
Workers’ welfare fund 88,701,984 130,596,244
Workers’ welfare fund - prior 3,275,017 –
Donations 37.2 17,700,000 1,600,000
Impairment loss on PPE transferred to assets held for sale – 3,109,448
Foreign exchange loss - net – 53,189,642
Balances written off - net 7,545,798 7,238,985
353,845,442 533,107,437
37.1 The charges for professional services consist of the following in respect of joint auditors’ services for:
124
Rupees
2023 2022
Fazal Mahmood & Co.

- Statutory audit fee 1,260,000 1,050,000
- Half yearly review 157,500 157,500
- Review report on code of corporate governance &
other certifications 63,000 52,500
- Out of pocket expenses 31,500 20,000
1,512,000 1,280,000
Muniff Ziauddin & Co.
- Statutory audit fee 1,260,000 –
- Half yearly review 157,500 –
- Review report on code of corporate governance &
other certifications 63,000 –
- Out of pocket expenses 31,500 –
1,512,000 –
3,024,000 1,280,000
37.2 Detail of recipients of donations, where total donation exceeds 10% of total donations or Rs. 1,000,000/- whichever is
higher:
Rupees
2023 2022
Rehman foundation 5,700,000 600,000

Help line foundation 6,500,000 –
Lahore chamber of commerce & industry 2,500,000 –
Al mustafa welfare trust 1,000,000 1,000,000
Akhuwat 1,000,000 –
16,700,000 1,600,000
Above recipients of donations do not include any donee in which any director or his / her spouse had any interest.
125
38.
OTHER INCOME
Profit on saving accounts 41,322,528 11,451,134
Profit on term deposit receipts 63,212,438 5,300,581
Profit on long-term investment in financial assets 8. 4,842,830 –
Foreign exchange gain - net 103,312,370 –
Commission against corporate guarantee 32. 60,000,000 60,000,000
Gain on disposal of tangible fixed assets 50,855,832 14,132,739
Balances written back – 12,128,012
Sales tax adjustment – 44,611,628
Rental income – 4,550,000
Miscellaneous income 511,600 61,206,757
324,057,598 213,380,851
39.
FINANCE COST
Profit / interest / mark-up in respect of:
- Long-term financing 714,150,193 506,819,889
- Short-term borrowings 3,567,171,258 2,037,565,018
4,281,321,451 2,544,384,907
Interest on workers’ profit participation fund 53,360,169 –
Bank charges 88,500,381 77,760,890
4,423,182,001 2,622,145,797
39.1 Borrowing costs capitalized during the year amounted to Rs. 121.618 million (2022: Rs. 45.377 million). The rate of
mark-up has been disclosed in note 23 to the financial statements.
40.
TAXATION
Current year 552,866,427 402,399,047
Prior year 40.4 (219,099,569) (1,246,913)
333,766,858 401,152,134
Deferred tax - origination and reversal of
temporary differences 532,145,567 389,872,078
865,912,425 791,024,212
126
40.1 Relationship between income tax expense and accounting profit:
Rupees
2023 2022
Profit before taxation 4,346,397,216 6,201,983,353

Tax on accounting profit at the applicable corporate tax rate of 29% (2022: 29%) 1,260,455,193 1,798,575,172
Tax effect of amounts that are admissible for tax purposes (456,597,777) (336,000,895)
Tax effect of amounts that are inadmissible for tax purposes 266,457,940 431,071,257
Tax effect of tax credits / losses / minimum taxes (305,049,905) (700,621,617)
Tax effect of income subject to final taxation (920,503,075) (1,073,450,681)
Tax effect of income subject to minimum taxation 654,494,407 –
Tax effect of super tax 53,609,644 282,825,811
Tax effect of prior year (219,099,569) (1,246,913)
Tax effect of timing differences 532,145,567 389,872,078
865,912,425 791,024,212
Average effective rate of tax charged to statement of profit or loss % 19.92% 12.75%
40.2 The tax provision is calculated by considering the various taxes applicable on local, exports and trading income
in view of provisions of various sections of Income Tax Ordinance, 2001, after taking to account any adjustments
of brought forward tax losses, minimum taxes and tax credits (if any) available under the Income Tax Ordinance,
2001. During the year, unrecognized minimum taxes of Rs. Nil (2022: Rs. 326.572 million) have been used to reduce
current tax expense. In accordance with the Finance Act 2023, rate of super tax has been revised from 4% to 10%.
Accordingly, the Company has recorded deferred tax @ 39%.
40.3 The income tax assessments of the Company have been finalized up to and including the assessment year 2008. Tax
returns of subsequent years are deemed to be assessed under provisions of the Income Tax Ordinance, 2001, unless
selected for audit by the taxation authorities (note 32). The Commissioner of income tax may at any time during the
period of six years from the end of the tax year to which they relate, may select the deemed assessment order for
audit. As at the year end, the Company has filed tax returns up to tax year 2022.
40.4 This mainly represents reversal on account of tax credit availed against super tax at the time of filing of income tax
return for the tax year 2022.
41. EARNINGS PER SHARE - BASIC AND DILUTED

Profit for the year 3,480,484,791 5,410,959,141
Weighted average number of ordinary shares 41.1 335,633,933 335,633,933
Earnings per share - Basic 10.37 16.12
41.1 There were no dilutive potential ordinary shares outstanding as at June 30, 2023 and June 30, 2022.
127
Rupees
2023 2022
42.
CASH GENERATED FROM OPERATIONS
Profit before taxation 4,346,397,216 6,201,983,353
Adjustments:
Depreciation of property, plant and equipment 456,761,165 445,474,410
Amortization of intangible asset 721,651 2,886,623
Expense recognized for employee defined benefit charge 169,312,697 122,861,112
Allowance for expected credit losses 34,444,853 33,476,039
Balances written off 7,545,798 7,238,985
Balances written back – (12,128,012)
Sales tax adjustment – (44,611,628)
Gain on disposal of tangible fixed assets (50,855,832) (14,132,739)
Impairment loss on PPE transferred to assets held for sale – 3,109,448
Profit on term deposit receipts (63,212,438) (5,300,581)
Net unrealized foreign exchange loss / (gain) 129,135,475 (67,342,798)
Finance cost 4,369,821,832 2,622,145,797
Workers’ profit participation fund 233,598,643 336,093,118
Interest on workers’ profit participation fund 53,360,169 –
Workers’ welfare fund 91,977,001 130,596,244
5,432,611,014 3,560,366,018
Profit before working capital changes 9,779,008,230 9,762,349,371
Effect on cash flow due to working capital changes:
(Increase) / decrease in current assets:
Inventories (67,289,466) (8,095,092,729)
Trade debts (3,731,981,147) (352,575,860)
Loans and advances (283,113,609) (12,683,065)
Deposits, prepayments and other receivables (425,930,455) 747,061,548
Due from the Government (712,043,387) 446,501,050
(5,220,358,064) (7,266,789,056)
Increase / (Decrease) in current liabilities:
Trade and other payables 196,212,880 1,019,352,918
4,754,863,046 3,514,913,233
43. CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR

Cash and cash equivalents included in the statement of cash flows comprise of the following amounts:
Cash and bank balances 16. 2,885,126,870 5,175,634,586

Temporary bank overdraft 30.4 – (12,182,111)
2,885,126,870 5,163,452,475
128
Rupees
2023 2022
44. CAPACITY AND ACTUAL PRODUCTION

Ferrous:
Melting
- Active capacity 500,000 500,000
- Actual production 181,690 261,698
Re-rolling
Non-Ferrous:
Melting
Processing
- Active capacity 90,000 –
- Actual processing 5,600 –
44.1 Total active capacity available comprises of currently active capacities and does not include temporarily suspended
capacities. Short-fall in actual production is due to market demand. Recycling plant achieved CoD during the last
quarter of FY-2023, due to which there was significant short-fall in actual processing.
Rupees
2023 2022
45. NUMBER OF EMPLOYEES

Number of persons employed as at June 30, 2,250 2,197
Average number of employees during the year 2,224 2,157
46. RELATED PARTY DISCLOSURE

The Company (“the reporting entity”) in the normal course of business carries out arm’s length transactions with various
related parties (“the entities”). Related parties comprise of entities regarded as related due to common directorship
or common management, major shareholders, key management personnel and their close family members (“the
relatives”). Major shareholders are those persons having control of or significant influence over the reporting entity. Key
management personnel are those persons having authority and responsibility for planning, directing and controlling
the activities of the reporting entity, directly or indirectly including Directors (whether executive or otherwise) of the
reporting entity.
Detail of related parties with whom the Company had entered into transactions or had agreements and / or
arrangements in place during the year, along with the basis of relationship, percentage of shareholding and details of
transactions (other than those which have been disclosed elsewhere in these financial statements) are as follows:
129
Rupees
2023 2022
Entities
Al-Bashir (Private) Limited
Relationship Common Directorship
Percentage of shareholding Nil
Detail of transactions
- Rental expense 1,920,000 1,742,500
Mughal Energy Limited

Relationship Common Directorship
Percentage of shareholding Nil
Detail of transactions
- Commission income (note. 32) 60,000,000 60,000,000
Major shareholders, key management

personnel and their relatives
Major shareholders, Directors and their relatives
- Dividends paid – 650,663,022
- Bonus shares allotted – 282,896,910
- Short-term loans - repayment / proceeds 19,373,776 21,869,298
Key management personnel (other than Directors)

and their relatives
- Advances - repaid / issued 4,228,000 4,323,500
- Dividends paid – 18,801
- Bonus shares allotted – 8,170
There were no outstanding balances with related parties as at the year end except for those which have been disclosed
separately in relevant notes. Details of salaries and benefits to key management personnel have been disclosed in
note 47.
47. REMUNERATION OF CHIEF EXECUTIVE OFFICER, DIRECTORS AND EXECUTIVES
Rupees Chief Executive Officer Executive Directors Executives

2023 2022 2023 2022 2023 2022
Managerial remuneration 22,893,232 12,000,000 41,900,344 26,400,000 207,112,389 197,402,705

Defined benefit charge 4,263,118 1,452,497 7,802,574 3,195,493 44,112,124 35,421,436
Other short-term benefits – – – – 40,001,968 42,872,671
27,156,350 13,452,497 49,702,918 29,595,493 291,226,481 275,696,812
Number of persons 1 1 2 2 70 59
47.1 1 (2022: 3) Non-Executive Director(s) including the Chairman, were paid fee aggregating to Rs. 7.697 million (2022:
Rs. 10.105 million) with view of encouraging retention and value creation within the Company.
47.2 Executives include aggregate amount in respect of salary and benefits to 3 (2022: 3) key management personnel
(other than Directors) amounting to Rs. 53.618 million (2022: Rs. 52.972 million). Benefits include Rs. 12.225 million
130
(2022: Rs. 10.222 million) on account of defined benefit charge and Rs. 7.345 million (2022: Rs. 7.440 million) on
account of other benefits.
47.3 Amount charged in these financial statements in respect of meeting fee amounted to Rs. 3.937 million (2022: 1.525
million) on account of meeting fee paid to 3 (2022: 3) Independent Directors and 3 (2022: 3) Non-Executive Directors.
47.4 Chief Executive Officer, Executive Directors, certain key management personnel (other than Directors) and some of the
executives are provided with Company maintained cars in accordance with their terms of employment. The Company
bears travelling expenses (if any) of Chairman, Chief Executive Officer, Directors and other key management personnel
relating to travel for official purposes including expenses incurred in respect of attending Board and Committee
meetings.
47.5 Executives mean employees other than the Chief Executive Officer and Directors, whose basic salary exceeds Rs.
1,200,000/- in a financial year.
48. SEGMENT REPORTING

48.1 Reportable segments:
The Company’s reportable segments are as follows:
- Ferrous
- Non - Ferrous
Ferrous segment comprises of long-rolled mild steel related products whereas non-ferrous segment mainly comprises
of copper related products and iron waste. Information regarding the Company’s reportable segments is presented
below.
48.2 Segment revenues and measure of segment profit or loss:

Following is an analysis of the Company’s revenue and results by reportable segment for the year ended June 30,
2023 and June 30, 2022 along with reconciliation of the total of the reportable segments’ measures of profit or loss to
the Company’s profit or loss before taxation:
Rupees Ferrous Non-Ferrous Total

2023 2022 2023 2022 2023 2022
Sales - net 47,006,136,163 48,219,287,556 20,384,034,600 17,933,520,099 67,390,170,763 66,152,807,655

Cost of sales (42,474,307,229) (43,316,941,790) (15,244,835,644) (12,707,978,286) (57,719,142,873) (56,024,920,076)
Gross profit 4,531,828,934 4,902,345,766 5,139,198,956 5,225,541,813 9,671,027,890 10,127,887,579
Sales and marketing
expenses (103,285,473) (182,964,019) (51,844,333) (62,650,942) (155,129,806) (245,614,961)
Allowance for expected
credit losses (62,792,585) (4,872,695) 28,347,732 (28,603,344) (34,444,853) (33,476,039)
Finance cost (138,405,927) (29,039,405) (70,345,761) (56,900,833) (208,751,688) (85,940,238)
(304,483,985) (216,876,119) (93,842,362) (148,155,119) (398,326,347) (365,031,238)
Segment profit before taxation and
unallocated income and expenses 4,227,344,949 4,685,469,647 5,045,356,594 5,077,386,694 9,272,701,543 9,762,856,341
131
Rupees Total
2023 2022
Unallocated income and expenses:
Administrative expenses (682,086,170) (704,940,843)
Other charges (353,845,442) (533,107,437)
Other income 324,057,598 213,380,851
Finance cost (4,214,430,313) (2,536,205,559)
Taxation (865,912,425) (791,024,212)
Profit for the year 3,480,484,791 5,410,959,141
Revenue reported above represents revenue generated from external customers. The accounting policies of the
reportable segments (except as disclosed otherwise) are the same as the Company’s accounting policies as
described in note 4 to these financial statements. The ferrous segment allocates certain percentage of sales and
marketing relating common expenditure to non-ferrous segment. Segment profit represents the profit earned by each
segment before taking account of unallocated income and expenses which are presented separately. This is the
measure reported to the chief operating decision-maker for the purposes of resource allocation and assessment of
segment performance.
48.3 Revenue from external customers:

The analysis of the Company’s revenue from external customers for major products is as follows:
Rupees
2023 2022
Ferrous
- Steel re-bars 58.10% 66.28%
- Girders 29.35% 27.57%
- Billets 9.64% 3.65%
- Others 2.91% 2.50%
100.00% 100.00%
Non-Ferrous
- Copper ingots 64.46% 74.49%
- Copper granules 8.58% 0.00%
- Copper scrap 4.42% 3.66%
- Waste 21.79% 20.98%
- Others 0.75% 0.87%
100.00% 100.00%
48.4 Information about major customers:

Revenue from major customers of ferrous segment represent Nil (2022: 50%) of the total revenue of ferrous segment.
Revenue from major local customers of non-ferrous segment represent 15% (2022: 15%) of the total revenue of non-
ferrous segment and 58% (2022: 58%) of the total local revenue of non-ferrous segment. Revenue from major foreign
customers of non-ferrous segment represent approx. 58% (2022: 74%) of the total revenue of non-ferrous segment
and 79% (2022: 99%) of the total foreign revenue of non-ferrous segment.
48.5 Geographical information:

All revenues from external customers for ferrous segment were generated in Pakistan. 74% (2022: 74%) of revenues
from external customers for non-ferrous segment were generated from outside Pakistan while remaining were
132
generated from external customers within Pakistan. Sales outside of Pakistan is made to customers in the People’s
Republic of China. All non-current assets of the Company as at June 30, 2023 and June 30, 2022 were located and
operating in Pakistan.
48.6 Measure of total assets and total liabilities:

Reportable segments’ assets and liabilities as at June 30, 2023 and June 30, 2022 are reconciled to total assets and
liabilities as follows:
Rupees Ferrous Non-Ferrous Total
- Segment assets for reportable segments 38,030,893,612 10,979,690,906 49,010,584,518

- Unallocated assets – – 10,821,402,960
- Total assets as per statement of financial
position as at June 30, 2023 38,030,893,612 10,979,690,906 59,831,987,478
- Segment liabilities for reportable segments 1,086,802,021 3,001,125,750 4,087,927,771

- Unallocated liabilities – – 30,371,623,761
- Total liabilities as per statement of financial
- Segment assets for reportable segments 32,550,266,607 9,834,480,587 42,384,747,194

- Unallocated assets – – 10,700,712,549
- Total assets as per statement of financial
- Segment liabilities for reportable segments 1,956,434,706 1,809,580,334 3,766,015,040

- Unallocated liabilities – – 28,472,366,464
- Total liabilities as per statement of financial
Rupees
2023 2022
48.7
Other information:
Depreciation
- Ferrous 361,664,489 365,203,106
- Non-Ferrous 10,969,877 2,960,410
- Unallocated 84,126,799 77,310,894
456,761,165 445,474,410
Additions to tangible fixed assets

- Ferrous 89,965,724 733,384,930
- Non-Ferrous 1,742,367,756 –
- Unallocated 110,740,257 384,949,417
1,943,073,737 1,118,334,347
Total amortization in respect of intangible asset is unallocated.
133
49. RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES

The table below details changes in the Company’s liabilities arising from financing activities, including both cash and
non–cash changes. Liabilities arising from financing activities are those for which cash flows were, or future cash flows
will be, classified in the Company’s statement of cash flows as cash flows from financing activities.
Rupees Opening Financing cash Other Closing

balance flows (49.1) changes balance
Long-term financing 5,309,181,886 (341,094,324) 12,390,332 4,980,477,894

Unclaimed dividends 2,963,664 (6,726) – 2,956,938
Unpaid dividends 7,068,715 (962,783) – 6,105,932
Accrued profit / interest / mark-up 379,869,093 (3,859,932,713) 4,369,821,832 889,758,212
Short-term borrowings 20,606,763,406 388,282,887 – 20,995,046,293
Short-term loans from Directors 25,062,812 (19,373,776) – 5,689,036
June 30, 2023 26,330,909,576 (3,833,087,435) 4,382,212,164 26,880,034,305
Long-term financing 4,676,885,365 610,925,541 21,370,980 5,309,181,886

Unclaimed dividends 2,982,204 (18,540) – 2,963,664
Unpaid dividends 5,675,118 (1,005,508,202) – 7,068,715
Accrued profit / interest / mark-up 251,457,149 (2,493,733,853) 2,622,145,797 379,869,093
Short-term borrowings 16,107,717,529 4,499,045,877 – 20,606,763,406
Short-term loans from Directors 3,193,514 21,869,298 – 25,062,812
June 30, 2022 21,047,910,879 1,632,580,121 2,643,516,777 26,330,909,576
49.1 This represents net amount of proceeds and repayments.
50. FINANCIAL INSTRUMENTS

Financial risk management:
The Company has exposure to the following risks arising from its use of financial instruments:
- Credit risk
- Liquidity risk
- Market risk
Risk management framework:
The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management
framework and for developing and monitoring the Company’s risk management policies. The Company’s risk
management policies are established to identify and analyze the risks faced by the Company, to set appropriate risk
limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed
regularly to reflect changes in market conditions and the Company’s activities.
50.1 Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to
meet its contractual obligations, and arises from long-term investment in financial assets, long-term loan to employees,
long-term deposits, trade debts, certain loans and advances, certain deposits, prepayments and receivables and
balances with banks. The Company has a policy of dealing only with credit worthy counter parties and obtaining
sufficient collateral, where appropriate as a means of mitigating the risk of financial loss from defaults. The carrying
value of financial assets represents the maximum credit risk. The detail of financial assets along with maximum
exposure to credit risk is as follows:
134
Rupees
2023 2022
Long-term investment in financial assets 50,153,187 –

Long-term loans to employees 65,909,792 51,269,414
Long-term deposits 2,838,069 19,845,317
Trade debts - net 9,283,146,446 5,573,585,633
Loans and advances 69,497,531 53,742,166
Deposits, prepayments and other receivables 560,938,399 143,070,662
Bank balances 2,885,090,228 5,173,510,372
12,917,573,652 11,015,023,564
Maximum exposure to credit risk by type of counterparty is as follows:
Rupees
2023 2022
Trade debts - net 9,283,146,446 5,573,585,633

Bank balances and margins with banking companies
and financial institutions 3,432,327,550 5,312,070,428
Others 202,099,656 129,367,503
12,917,573,652 11,015,023,564
Geographically, there is no concentration of credit risk except for certain receivables from export parties which
constitute almost 13% (2022: 14%) of total financial assets. Out of the total financial assets, credit risk is concentrated
in trade debts and bank balances as they constitute almost 98% (2022: 99%) of the total financial assets.
The Company’s exposure to customers is diversified and majority of the Company’s customers have been transacting
with the Company without any default history. None of the customers are credit-impaired at the reporting date.
Expected credit loss assessment in respect of trade debts is provided in note 12 and 4.8. Management does not
expect non-performance by these counter parties on their obligations to the Company. Accordingly, the credit risk is
minimal.
Long-term investment in financial assets, long-term loans to employees, long-term deposits, and certain items of
loans and advances, deposits, prepayments and other receivables are considered to have low credit risk. Expected
credit loss policy in respect of these financial assets is provided in note 4.8.
The Company considers that its bank balances have low credit risk based on the external credit ratings of the
counterparties assigned to them by credit rating agencies. Out of the total bank balances of Rs. 2,885.090 million
(2022: Rs. 5,173.510 million) amounts aggregating to Rs. 2,395.431 million (2022: Rs. 2,323.746 million) are with
banks having short-term credit rating of A1+. Whereas the remaining major amounts are placed with banks having
minimum short-term credit rating of A-1.
In respect of guarantees provided by the Company, the maximum exposure which the Company is exposed to is the
maximum amount which the Company would have to pay if the guarantee is called upon. Based on the expectation at
the end of the reporting period, the Company considers that it is more likely that such an amount will not be payable
under the guarantees provided.
The other financial assets are neither material to the financial statements nor exposed to any significant credit risk.
The Company does not hold any collateral as security against any of its financial assets other than long-term loans to
135
employees and advances to employees as detailed in relevant notes. Detail of financial assets on which lien of sukuk
holders is marked is given in note 16. Deposits, prepayments and other receivables include guarantee margin against
guarantees issued by banks.
50.2 Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet
its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking
damage to the Company’s reputation. The Company uses different methods which assists it in monitoring cash flow
requirements. Typically, the Company ensures that it has sufficient cash on demand to meet expected operational
expenses for a reasonable period, including the servicing of financial obligations (this excludes the potential impact
of extreme circumstances that cannot reasonably be predicted, such as natural disasters) by maintaining adequate
reserves, banking facilities and reserve borrowing facilities and continuously monitoring forecast and actual cash
flows and matching the maturity profiles of financial assets and liabilities. Included in notes 23 and 30 to the financial
statements is a detail of additional undrawn facilities that the Company has at its disposal to further reduce liquidity risk.
The following are the contractual maturities of financial liabilities including estimated interest payments and excluding
the impact of netting agreements.
Rupees
Carrying Contractual Within 1 More than After 5
amount cash flows year 1 but less years
than 5 years
At amortized cost
- Long-term financing 4,980,477,894 7,171,991,659 2,645,846,884 4,472,344,847 53,799,929
- Trade and other payables 2,543,913,867 2,543,913,867 2,543,913,867 – –
- Unclaimed dividends 2,956,938 2,956,938 2,956,938 – –
- Unpaid dividends 6,105,932 6,105,932 6,105,932 – –
- Accrued profit / interest / mark-up 889,758,212 889,758,212 889,758,212 – –
- Short-term borrowings 20,995,046,293 20,995,046,293 20,995,046,293 – –
- Short-term loans from Directors 5,689,036 5,689,036 5,689,036 – –
June 30, 2023 29,423,948,172 31,615,461,937 27,089,317,162 4,472,344,847 53,799,929
At amortized cost
- Long-term financing 5,309,181,886 7,556,262,660 2,121,813,077 5,351,864,407 82,585,175
- Trade and other payables 2,060,196,194 2,060,196,194 2,060,196,194 – –
- Unclaimed dividends 2,963,664 2,963,664 2,963,664 – –
- Unpaid dividends 7,068,715 7,068,715 7,068,715 – –
- Accrued profit / interest / mark-up 379,869,093 379,869,093 379,869,093 – –
- Short-term borrowings 20,618,945,517 20,618,945,517 20,618,945,517 – –
- Short-term loans from Directors 25,062,812 25,062,812 25,062,812 – –
June 30, 2022 28,403,287,881 30,650,368,655 25,215,919,072 5,351,864,407 82,585,175
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier or at significantly
different amounts. The contractual cash flow relating to long-term financing have been determined on the basis of
expected profit / interest / mark-up rates. These rates have been disclosed in note 23 to the financial statements.
136
50.3 Market risk
Market risk is the risk that changes in market prices, such as currency risk, interest rates and equity prices will affect the
Company’s income or the value of its holdings of the financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimizing return.
i) Foreign currency risk:

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of change in foreign exchange rates. The Company is mainly exposed to currency risk on foreign
trade debts, foreign creditors, foreign currency accounts and short-term foreign loans which are denominated
in currency other than the functional currency of the Company.
The Company’s net exposure to foreign currency risk is as follows:
Rupees
2023 2022
- in US Dollar ($) 3,790,004 5,005,373

- Pakistani rupee to US Dollar ($) exchange rate as at June 30, 276.00 206.00
Sensitivity analysis:
At the reporting date, if the Pakistani rupee had reasonably possibly strengthened / weakened by 5% against
foreign currency, it would have affected the measurement of financial instruments denominated in foreign
currency and affected profit or loss on net basis by the amounts shown below at the reporting date:
Rupees
2023 2022
- Increase / decrease in US Dollar ($) conversion rate 52,302,051 51,555,337
The analysis assumes that all other variables, in particular interest and tax rates, remain constant and ignores
any impact of forecast sales and purchases.
Foreign currency risk management:

The Company manages currency risk by maintaining balance between sight and deferred letters of credit
and switching amongst them when required necessary and taking currency exposures for limited periods
within predefined limits while rigorously monitoring open exposures. Foreign currency risk is also curtailed
due to existence of both import and export activities in foreign currencies.
ii) Price risk:

Price risk represents the risk that the fair value or future cash flows of 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 instruments or its issuer, or factors
affecting all similar financial instruments trading in market. The Company does not hold any investments
which exposed it to price risk.
iii) Interest rate risk:

The interest rate risk is the risk that the fair value or the future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. Majority of the interest rate exposure arises from long-
137
term financing, short-term borrowings, long term investment in financial assets, saving accounts and term
deposit receipts. at the reporting date the interest rate risk profile of the Company’s interest bearing financial
instruments is:
Rupees
2023 2022
- Financial assets 978,413,557 2,389,947,954

- Financial liabilities 25,975,524,187 25,915,945,292
Sensitivity analysis:
Sensitivity to interest rate risk arises from mismatch of financial assets and financial liabilities that mature or re-price in
a given period.
Fair value sensitivity analysis for fixed rate instruments:
The Company does not account for any fixed rate financial instruments at fair value through profit or loss, therefore, a
change in interest rate at the reporting date would not affect the profit or loss.
Cash flow sensitivity analysis for variable rate instruments:
A change of 100 basis points in interest rates at reporting date would have increased / decreased profit for the year
by Rs. 249.971 million (2022: 235.260 million)
The related mark-up rates for variable rate financial instruments are indicated in the relevant notes to the financial
statements. The sensitivity analysis prepared is not necessarily indicative of the effects on the profit for the period and
assets / liabilities of the Company.
Interest rate risk management:

The Company manages these mismatches through risk management strategies where significant changes in gap
position can be adjusted and controlling working capital cycles.
50.4 Fair value of financial instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. In estimating fair value of an asset or liability, the Company
takes into the characteristics of the asset or liability if market participants would take those characteristics into account
when pricing the asset or liability at the measurement date.
In addition, for financial reporting purposes, fair value measurements are categorized into level 1, 2 or 3 based on the
degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair
value measurements in its entirety, which are described as follows:
Level 1 inputs - are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can
access at the measurement date.
Level 2 inputs - these are inputs, other than quoted prices included within Level 1, that are observable for the asset or
liability, either directly or indirectly; and
Level 3 inputs - are unobservable inputs for the asset or liability.
138
The Company takes in to account factors specific to the transaction and to the asset or liability, when determining
whether or not the fair value at initial recognition equals the transaction price. Except for long-term loans to employees,
long-term deposits and long-term loans under SBP refinance schemes, the fair value of financial assets and financial
liabilities recognized in these financial statements equals the transaction price at initial recognition. The fair value of
the long-term loans under SBP refinance schemes has been determined using discounting techniques. However,
due to immaterial effect and impracticalities, the fair value of long-term loans to employees and long-term deposits
has not been determined and their carrying value has been assumed to be equal to their fair value. Accordingly, the
carrying amount of financial assets and financial liabilities recognized in these financial statements approximate their
respective fair values.
Rupees Amortized cost

2023 2022
50.5
Financial instruments by category
Financial assets:
Maturity within one year
- Trade debts 9,283,146,446 5,573,585,633
- Loans and advances 69,497,531 53,742,166
- Deposits, prepayments and other receivables 560,938,399 143,070,662
- Cash and bank balances 2,885,126,870 5,175,634,586
Maturity after one year
- Long-term investment in financial assets 50,153,187 –
- Long-term loan to employees 65,909,792 51,269,414
- Long-term deposits 2,838,069 19,845,317
12,917,610,294 11,017,147,778
Rupees Other financial liabilities

2023 2022
Financial liabilities:
Maturity within one year
- Trade and other payables 2,543,913,867 2,060,196,194
- Unclaimed dividends 2,956,938 2,963,664
- Unpaid dividends 6,105,932 7,068,715
- Accrued profit / interest / mark-up 889,758,212 379,869,093
- Short-term borrowings 20,995,046,293 20,618,945,517
- Short-term loans from Directors 5,689,036 25,062,812
- Current portion of long-term financing 1,678,411,215 1,281,336,412
Maturity after one year
- Long-term financing 3,302,066,679 4,027,845,474
29,423,948,172 28,403,287,881
139
Rupees Other financial liabilities

2023 2022
Off balance sheet financial liabilities:

- Letters of credits 8,429,575,445 7,320,259,015
- Letters of guarantees 3,418,704,111 2,848,462,241
- Corporate guarantee 6,000,000,000 6,000,000,000
17,848,279,556 16,168,721,256
51. SHARIAH COMPLIANCE DISCLOSURE

Loans / advances obtained as per Islamic mode 51.1 11,506,011,322 14,963,490,043
Shariah compliant bank deposits / bank balances 1,635,318,092 1,643,989,041
Profit earned from Shariah compliant bank
deposits / balances 51.2 16,324,061 4,553,931
Profit earned from Shariah compliant investments 4,842,830 –
Mark-up on Islamic mode of financing 2,042,236,288 1,409,072,358
Interest on any conventional loan or advance 2,239,085,163 1,135,312,549
51.1 These loans have been obtained against various facilities from different Islamic financial institutions under various
financing arrangements and carry profit rate ranging between 1MK to 6MK + 0.60% to 1% (2022: 1MK to 6MK+
0.60% to 1%) per annum.
51.2 These represent saving accounts with Islamic financial institutions and carry profit ranging up to 20% (2022: 12%).
51.3 The entire revenue of the Company is from Shariah compliant business segments except for profit / interest income
earned on term deposit receipts / saving accounts maintained with conventional banks. During the year, no investments
of any kind were made except as disclosed elsewhere. The Company maintains good relationship with Shariah
compliant banks and carries out trade and other routine banking transactions with them. Details of outstanding long-
term financing and short-term borrowings has been disclosed in note 23 and 30 to the financial statements. There was
no exchange gain earned on actual currency. Details of exchange gain / loss recognized during the year has been
disclosed in the statement of cash flows.
52. CAPITAL MANAGEMENT

The Company’s objective when managing capital is to safeguard the Company’s ability to remain as a going concern
and continue to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital
structure to reduce the cost of capital. The Company manages its capital structure and makes adjustments to it in
the light of changes in economic conditions. To maintain or adjust the capital structure, the Company may adjust the
dividend payment to shareholders or issue new shares. The Company is currently financing majority of its operations
/ investing activities through long-term financing and short-term loans in addition to its equity. The Company has a
gearing ratio of 50.61% (2022: 55.47%) as of the reporting date. In accordance with the agreements executed with
the lenders the Company is required to ensure that the total long-term financing to equity ratio does not exceed the
lender covenants. The Company has ensured compliance with all lender covenants.
140
53. SUBSEQUENT EVENTS - NON ADJUSTING EVENTS
The Board of Directors in its meeting held on September 22, 2023 has proposed final cash dividend of Rs. 3.20 per
share i.e 32 % amounting to Rs. 1,074.029 million. These financial statements do not include the effect of the above
appropriation, which will be accounted for in the year in which it is approved.
In addition, the Members of the Company in their Extraordinary General Meeting (EOGM) held on September 19, 2023
have approved the following:
a) Purchase of 174.692 million fully paid ordinary shares and 22.570 million fully paid Class-B shares of Mughal
Energy Limited (an associated company) for an aggregate consideration of Rs. 3,150.000/- million, whereby,
Mughal Energy Limited will become wholly owned subsidiary of the Company.
b) Increase in authorized capital of the Company from Rs. 5,000.000 million divided into 500.000 million
ordinary shares of Rs. 10/- each to Rs. 10,000.000 million divided into 700.000 million ordinary shares of
Rs. 10/- each, 250.000 million ordinary Class-B shares of Rs. 10/- each and 50.000 million ordinary Class-C
shares of Rs. 10/- each.
c) Authorization to the Board of Directors, to issue 50.000 million ordinary Class-C shares of Rs. 10/- each as
and when deemed fit, with such rights and privileges as mentioned in the notice of the said EOGM.
54. DATE OF AUTHORIZATION

These financial statements were authorized for issue on September 22, 2023 by the Board of Directors of the Company.
55. GENERAL
The figures have been rounded off to the nearest rupee.
Corresponding figures are rearranged and reclassified, wherever considered necessary for the purposes of
comparison and better presentation, however, no significant rearrangements / reclassifications were made during the
year.

141
05
OTHER
INFORMATION
• Pattern of Shareholding
• Trading in Shares of the Company
• Notice of Annual General Meeting
• Statement of Material Facts as Required Under Section 134(3) of the
Companies Act, 2017
• Form of Proxy
• ‫پراکسی فارم‬
PATTERN OF SHAREHOLDING
AS ON JUNE 30, 2023
No. of Having shares Shares

shareholders From To held Percentage
1256 1 100 54202 0.02%

979 101 500 279002 0.08%
1346 501 1000 977028 0.29%
2100 1001 5000 4173307 1.24%
320 5001 10000 2289702 0.68%
102 10001 15000 1280527 0.38%
67 15001 20000 1201799 0.36%
46 20001 25000 1056577 0.31%
29 25001 30000 794701 0.24%
19 30001 35000 637151 0.19%
24 35001 40000 910565 0.27%
22 40001 45000 917652 0.27%
17 45001 50000 819683 0.24%
11 50001 55000 579019 0.17%
5 55001 60000 292782 0.09%
7 60001 65000 437136 0.13%
7 65001 70000 470604 0.14%
3 70001 75000 223166 0.07%
6 75001 80000 468526 0.14%
1 80001 85000 80040 0.02%
5 85001 90000 434708 0.13%
3 90001 95000 280796 0.08%
11 95001 100000 1085292 0.32%
1 100001 105000 104004 0.03%
4 105001 110000 434391 0.13%
2 110001 115000 228950 0.07%
2 115001 120000 236290 0.07%
2 120001 125000 241118 0.07%
1 125001 130000 130000 0.04%
3 130001 135000 394912 0.12%
1 140001 145000 142225 0.04%
2 145001 150000 297790 0.09%
3 150001 155000 459155 0.14%
1 155001 160000 159851 0.05%
2 160001 165000 323230 0.10%
3 170001 175000 520041 0.15%
1 185001 190000 189995 0.06%
2 195001 200000 398869 0.12%
1 200001 205000 201525 0.06%
3 210001 215000 637107 0.19%
2 215001 220000 433720 0.13%
1 220001 225000 224700 0.07%
1 225001 230000 230000 0.07%
2 235001 240000 475807 0.14%
1 240001 245000 244420 0.07%
2 245001 250000 500000 0.15%
1 265001 270000 265030 0.08%
1 270001 275000 274216 0.08%
1 285001 290000 286938 0.09%
1 295001 300000 299750 0.09%
1 300001 305000 301785 0.09%
1 330001 335000 332488 0.10%
2 335001 340000 675880 0.20%
1 390001 395000 392800 0.12%
1 400001 405000 400230 0.12%
1 530001 535000 534883 0.16%
144
No. of Having shares Shares
shareholders From To held Percentage
1 535001 540000 538466 0.16%

1 560001 565000 562403 0.17%
1 580001 585000 583766 0.17%
1 600001 605000 600573 0.18%
1 660001 665000 664691 0.20%
1 720001 725000 720326 0.21%
1 775001 780000 777388 0.23%
2 815001 820000 1634191 0.49%
2 845001 850000 1693826 0.50%
1 885001 890000 886443 0.26%
1 1055001 1060000 1058103 0.32%
1 1060001 1065000 1060501 0.32%
1 1235001 1240000 1238313 0.37%
1 1295001 1300000 1300000 0.39%
1 1320001 1325000 1323931 0.39%
1 1360001 1365000 1364924 0.41%
1 1440001 1445000 1442790 0.43%
1 1445001 1450000 1448591 0.43%
1 1685001 1690000 1686109 0.50%
1 2045001 2050000 2048190 0.61%
1 2160001 2165000 2161453 0.64%
1 2485001 2490000 2485742 0.74%
1 3160001 3165000 3160914 0.94%
1 3295001 3300000 3300000 0.98%
1 3915001 3920000 3917981 1.17%
1 4150001 4155000 4153351 1.24%
1 4160001 4165000 4164327 1.24%
1 4275001 4280000 4279210 1.27%
1 4680001 4685000 4680642 1.39%
1 6165001 6170000 6166055 1.84%
1 6965001 6970000 6967190 2.08%
1 8315001 8320000 8315010 2.48%
1 8325001 8330000 8328653 2.48%
1 8775001 8780000 8777920 2.62%
1 23560001 23565000 23562603 7.02%
1 23570001 23575000 23574653 7.02%
1 23790001 23795000 23793777 7.09%
1 33135001 33140000 33137840 9.87%
2 35455001 35460000 70919182 21.13%
1 36435001 36440000 36437840 10.86%
6483 335633933 100.00%
Category of shareholders Shares Held Percentage
DIR, CHIEF EXE. OFFICER, AND THEIR SPOUSE AND MINOR CHILDERN 144,991,243 43.1992%
ASSOCIATED COMPANIES, UNDERTAKING AND RELATED PARTIES 107,935,975 32.1588%
BANKS, DFI AND NBFI 13,986,718 4.1673%
INSURANCE COMPANIES 6,651,249 1.9817%
MODARABAS AND MUTUTAL FUNDS 21,985,227 6.5504%
GENERAL PUBLIC (LOCAL) 27,109,173 8.0770%
GENERAL PUBLIC (FOREIGN) 3,044,615 0.9071%
OTHERS 9,755,897 2.9067%
FOREIGN COMPANIES 173,836 0.0518%
COMPANY TOTAL 335,633,933 100%
145
TRADING IN SHARES OF THE COMPANY
AS ON JUNE 30, 2023
TRADING IN SHARES OF THE COMPANY BY THE DIRECTORS, EXECUTIVES, SUBSTANTIAL SHAREHOLDERS AND THEIR
SPOUSES AND MINOR CHILDREN DURING THE YEAR ENDED JUNE 30, 2023
Name Shares Purchased Shares Sold Shares Gifted (out)
Mr. Basit Habib 1,600 1,600 –

Mr. Fahad Javaid – – 3,300,000
146
NOTICE OF ANNUAL
GENERAL MEETING
Notice is hereby given that the 14th Annual General Meeting (the Meeting) of the
members of MUGHAL IRON & STEEL INDUSTRIES LIMITED (the Company) will be held
on Saturday, October 28, 2023 at 11:45 a.m. at Pearl Continental Hotel, Shahrah-e-
Quaid-e-Azam, Lahore to transact the following business:
ORDINARY BUSINESS
1. To receive, consider and adopt the Audited Financial Statements of the Company together with the Chairman’s Review
Report, the Directors’ Report and the Auditors’ Reports thereon for the year ended June 30, 2023.
2. To declare final cash dividend @ 32% i.e., Rs. 3.20/- per share of Rs. 10/- each for the year ended June 30, 2023, as
recommended by the Board of Directors.
3. To appoint auditors and fix their remuneration for the year ending June 30, 2024.
A notice referred to in sub-section (2) of section 246 of the Companies Act, 2017 is hereby given to the members that, the
Board of Directors upon recommendation of the Audit Committee has recommended the names of M/s. Fazal Mahmood
& Company, Chartered Accountants and M/s. Muniff Ziauddin & Company, Chartered Accountants the retiring auditors, for
re-appointment as joint external auditors of the Company after obtaining their consent.
SPECIAL BUSINESS
4. To consider and, if deemed fit, to pass with or without modification, the following resolutions as special resolutions with
respect to related party transactions in which some or majority of directors are interested:
“RESOLVED that the transactions entered into by the Company with related parties during the year ended June 30, 2023 as
disclosed in relevant notes to the financial statements in which some or majority of the directors are interested are hereby
ratified and confirmed.”
“FURTHER RESOLVED that the Company be and is hereby authorized to enter into and carry out transactions in its normal
course of the business from time to time with related parties during the ensuing year ending June 30, 2024. The members
have noted that for the aforesaid transactions some or a majority of the directors may be interested. Notwithstanding the
interest of the directors, the members hereby grant an advance authorization to the Board Audit Committee and the Board
of Directors of the Company to review and approve all related party transactions based on the recommendation of the
Board Audit Committee.”
“FURTHER RESOLVED that the related party transactions as aforesaid for the period ended June 30, 2024 would
subsequently be presented to the members at the next Annual General Meeting for ratification and confirmation.”
Statement of material facts as required under section 134(3) of the Companies Act, 2017 is annexed.

By Order of the Board
-sd-
Muhammad Fahad Hafeez
Lahore: October 05, 2023 Company Secretary
147
NOTES: are requested to get themselves registered by sending
1. Closure of share transfer books: their particulars at the designated e-mail address
[email protected], giving particulars as
The share transfer books of the Company will remain closed per below table latest by the close of business hours
from October 19, 2023 to October 28, 2023 (both days
(5:00 PM) on October 25, 2023.
inclusive). Physical transfers / Central Depository System
(CDS) Transaction IDs received in order by the Company’s
Name of CNIC No./ CDC Cell No Registered
share registrar, M/s. THK Associates (Private) Limited, 32- Member NTN No. Participant email
C, Jami Commercial Street 2, D.H.A Phase-VII, Karachi, ID/Folio No. address
up to the close of business on October 18, 2023, will be

considered in time for the entitlement of the members to
dividend and to participate and vote at the Meeting. Members, who are registered, after the necessary
verification, will be provided a Zoom video-link by the
2. Participation / proxies: Company on the same e-mail address that they e-mail
A member of the Company entitled to participate and
the Company with. The login facility will be provided
vote at this Meeting may appoint any other member of on the day of the Meeting and will remain open from
the Company as his/her proxy to participate, speak and 11:45AM till the end of the Meeting. Only those members
vote on his/her behalf at the Meeting. A member shall whose names appear in the register of members as of
not be entitled to appoint more than one proxy. The October 18, 2023 will be entitled to participate and vote
instrument appointing a proxy must be properly filled-in/ at the Meeting via Zoom-video link.
executed and in order to be valid, must be received at
the share registrar office of the Company, not later than 3. Dividend:
forty-eight (48) hours before the time scheduled for the As per Section 242 of the Companies Act, 2017, it is
Meeting. Attested copy of Computerized National Identity mandatory for all listed companies to pay cash dividend
Card (CNIC)/ Smart National Identity Card (SNIC) of the to its members through electronic mode directly into
member appointing the proxy shall be attached with the the bank account designated by the entitled member.
instrument. Accordingly, members are requested to provide/update
their correct International Bank Account Number (“IBAN”)
An instrument of proxy applicable for the Meeting is being
details latest by October 18, 2023. In case shares are
provided with the notice being sent to members. Further,
held in physical form, to the Company’s Share Registrar
copies of the instrument of proxy may also be obtained
and in case shares are held in CDS then with relevant
from the registered office of the Company during normal
Participant/CDC account services.
office hours or downloaded from the Company’s website:
www.mughalsteel.com. A company or a corporation being
Further, as per SECP directives, the dividend of members,
a member of the Company may appoint a representative
whose valid CNICs are not available with the Share
through a resolution of its board of directors for attending
Registrar, shall be withheld.
and voting at the Meeting. Members, who have deposited
their shares into Central Depositary Company of Pakistan
Limited, are further advised to follow the guidelines as
All members having physical shareholding are therefore
laid down by the SECP vide Circular No. 1 of 2000. advised to submit a photocopy of their valid CNICs
immediately, if already not provided, to the Share
Pursuant to section 132(2) of the Companies Act, 2017, if Registrar, without any further delay and latest by October
the Company receives a request from members holding 18, 2023.
an aggregate 10% or more shareholding residing in a
city, such members may request a video conferencing Please note that in case of failure to provide/update
facility for the purposes of participating in the Meeting at correct/valid IBAN/CNIC details by the members, the
such a location by sending a request to the Company at Company will be constrained to withhold payment of
least seven (07) days prior to the date of the Meeting, the dividend in accordance with the relevant provisions of
Company will arrange video conference facility in that city the Companies Act, 2017 and related regulations.
subject to the availability of such facility in that city.
Dividend income on shares is liable to deduction of
Members are also being provided with the facility to withholding tax under Section 150 of the Income Tax
participate in the meeting through electronic means Ordinance, 2001. Withholding of tax on dividend is
via Zoom video-link. Accordingly, interested members based on ‘Active’ and ‘Non-Active’ status of members,
148
whereby, rate of withholding tax is 15% and 30% 5. General:
respectively. ‘Active’ means a person whose name
Members holding shares in physical form are requested
appears on the Active Taxpayers List available at e-portal
to promptly notify Company’s share registrar, M/s. THK
of FBR (http://www.fbr.gov.pk/) and ‘Non-Active’ means
Associates (Private) Limited of any change in their postal/
a person whose name is not appearing on the Active
email addresses. Members maintaining their shares in
Taxpayers List. The Company will ascertain the tax status
CDS should have their address/ email addresses updated
of members as at the first day of book closure and will
with their relevant Participant/CDC account services.
deduct tax accordingly. All the members whose names
are not entered into the Active Taxpayer List, despite the
Members who by any reason, could not claim their
fact that they are filers, are advised to make sure that
dividend/shares are advised to contact our shares
their names are entered into the list latest by October
registrar M/s. THK Associates (Private) Limited to collect /
18, 2023, otherwise tax on their cash dividend will be
enquire about their unclaimed dividends/shares, if any.
deducted @30% instead @15%. Members who have
joint shareholdings held by Filers and Non-filers shall
Section 72 of the Companies Act, 2017 requires every
be dealt with separately and in such particular situation,
company to replace its physical shares with book-entry
each account holder is to be treated as either a Filer or a
form within the period to be notified by the SECP. The
Non-filer and tax will be deducted according to his / her
members having physical shareholding are accordingly
shareholding. If the share is not ascertainable then each
encouraged to open their account with investors account
account holder will be assumed to hold equal proportion
services of CDC or sub account with any of the brokers
of shares and the deduction will be made accordingly.
and convert their physical shares in script less form. This
Therefore, in order to avoid deduction of tax at higher
will facilitate the shareholders in many ways, including safe
rate, the joint account holders are requested to provide
custody and sale of shares, any time they want, as the
the below details of their shareholding to the Share
trading of physical shares is not permitted as per existing
Registrar of the Company latest by October 18, 2023.
regulations of the Pakistan Stock Exchange Limited.
CDC Account Name of Number or CNIC Signature

Number / shareholders percentage Number
Folio (Principal of Shares
The Company has placed the Audited Annual Financial
/ Joint held Statements for the year ended June 30, 2023 along with
Holders) (Proportion)
the Reports thereon on its website: www.mughalsteel.
com and the same are also electronically available
Members seeking exemption from deduction of income
on PUCARS system of the Pakistan Stock Exchange
tax or those members who are eligible for deduction
Limited. and can also be downloaded/viewed from the
at a reduced rate are requested to submit a valid tax
following QR code and weblink:
certificate or necessary documentary evidence, as the
case may be latest by October 18, 2023.
Please note that the information regarding gross

dividend, tax/zakat deduction and net amount of dividend
will be provided through the Centralized Cash Dividend https://www.mughalsteel.com/annual-reports-for-the-last-
Register, therefore, members should register themselves three-financial-years/?v=steel.
to CDC’s eService Portal.
4. Postal ballot facility:

Any member requiring printed copy of Annual Report
In accordance with the Companies (Postal Ballot)
2023 may send a request using a Standard Request
Regulations, 2018, the right to vote through electronic
Form placed on Company’s website which shall be
voting facility and voting by post shall be provided to
provided free of cost within seven (07) days.
members of the Company for all businesses classified
as special business under the Companies Act, 2017 in
For any query/problem/information, the investors may
the manner and subject to conditions contained in the
contact Mr. Zeeshan Ejaz at +92-42-35960841 and
Regulations.
e-mail address [email protected] and/or
THK Associates (Private) Limited at +92-21-35310191-6
and e-mail address [email protected].
149
STATEMENT OF MATERIAL FACTS AS REQUIRED UNDER SECTION 134(3)
OF THE COMPANIES ACT, 2017 IN RESPECT OF SPECIAL BUSINESS TO BE
TRANSACTED AT THE FORTHCOMING ANNUAL GENERAL MEETING IS
APPENDED BELOW:
This statement sets out the material facts concerning the special business listed at agenda item 4, to be transacted at the
forthcoming Annual General Meeting of the Company to be held on Saturday, October 28, 2023 at 11:45 a.m. at Pearl Continental
Hotel, Shahrah-e-Quaid-e-Azam, Lahore.
Agenda Item No. 4.

During the year, there were transactions entered into by the Company with related parties. However, since some or majority of
Company’s directors were directly or indirectly interested in these transactions due to their common directorship and/or holding
of shares in the related parties, the quorum of directors could not be formed for approval of these transactions. Accordingly,
these transactions, as disclosed in the relevant notes to the financial statements along with names, description and amounts,
are being placed before the members for their approval/ratification by passing special resolutions as mentioned in the Notice of
Annual General Meeting with or without modifications. All related party transactions are carried out at arm’s length in accordance
with the Company policies and comply with legal requirements and are reviewed periodically by the Board Audit Committee
which is chaired by an independent director. Rent expense is in respect of land taken on lease for administrative purposes with
agreement for one year, whereas, commission income is in respect of corporate guarantee issued by the Company to banks
on behalf of Mughal Energy Limited details of which are given in note. 32 to the financial statements. Following, review by the
Board Audit Committee, the said transactions are placed before the Board of Directors for approval.
Further, it is expected that the Company may be conducting related party transactions in the normal course of business in the
upcoming financial year as well, wherein, some or majority of directors are expected to be interested in due to their relationships,
common directorship and shareholding in these related parties. The members are informed that it is not possible to make
estimate of the quantum of related party transactions to be undertaken in the period ending June 30, 2024, which depends on
case-to-case basis, however, the Company will present the actual figures for subsequent ratification and confirmation by the
members, at the next annual general meeting. Based on the above, approval of the members is also sought to authorize the
Company to enter into such transactions with related parties during the ensuing year ending June 30, 2024 and further grant
power to the Board to periodically review and approve such transactions based on the recommendation of the Board Audit
Committee by passing Special Resolutions as mentioned in the Notice of Annual General Meeting with or without modifications.
The directors who are/may be interested in this subject matter are as follows:
1. Mr. Mirza Javed Iqbal 2. Mr. Khurram Javaid

3. Mr. Muhammad Mubeen Tariq Mughal 4. Mr. Fazeel Bin Tariq
5. Mr. Muhammad Mateen Jamshed 6. Mr. Jamshed Iqbal
The directors are interested in this business to the extent of their relationships, common directorships and their respective
shareholding in the related parties.
150
FORM OF PROXY
14th ANNUAL GENERAL MEETING
I/We ____________________________________________________________, being member(s) of Mughal Iron & Steel
Industries Limited and holder of ________________ Shares as per Folio No.______/CDC Participation ID # __________
and Sub Account # _________/CDC Investor Account ID #______________do hereby appoint ____________________
________________ of _____________________________________ or failing him/her _____________________________
of _____________________________ having Folio No.______/CDC Participation ID # __________ and Sub Account #
_________/CDC Investor Account ID #______________as my/our proxy to attend, speak and vote for me/us and on my/our
behalf at the Annual General Meeting of Mughal Iron & Steel Industries Limited scheduled to be held on Saturday, October
28, 2023 at 11:45 a.m. at Pearl Continental Hotel, Shahrah-e-Quaid-e-Azam Lahore and at any adjournment thereof.
At witness my/our hand this____________________day of __________________2023.
Please
1. Signature Affix Revenue
Stamps of Rs.
50/-
Name
C.N.I.C
Address
2. Signature
Name Members’ Signature

(This Signature should agree with the
C.N.I.C specimen signature with the company)
Address
Notes:
1. A member entitled to attend and vote at this meeting may appoint any other member as his / her proxy to attend,
speak and vote instead of him / her. A proxy must be a member of the Company.
2. A member shall not be entitled to appoint more than one proxy.
3. The instrument appointing a proxy must be duly signed and witnessed by two persons, whose names, addresses
and CNIC numbers shall be mentioned on the form.
4. Attested copies of the CNIC or the Passport of beneficial owners and the proxy shall be furnished along with the
proxy form. In case of corporate entity, the board’s resolution/power of attorney with specimen signature shall be
furnished along with the proxy form.
5. Proxies in order to be valid, must be received at the Share Registrar office of the Company, M/s. THK Associates
(Pvt.) Limited, 32-C, Jami Commercial Street 2, D.H.A Phase-VII, Karachi not later than forty eight (48) hours
before the time scheduled for the meeting.
Manager Share Registrar
(Mughal Iron & Steel Industries Limited)
M/s. THK Associates (Pvt.) Limited
D.H.A, Phase-VII, Karachi, Pakistan
‫�د�اں‬
‫�‬ ‫�‬
‫�� ‬
‫‪2023‬‬ ‫‪28‬‬
‫��اہ��ا�‬ ‫�ل ��‬ ‫� ‪11:45‬‬
‫‪2023‬‬
‫‪50/-‬‬
‫‪vii-‬‬ ‫‪32‬‬
Manager Share Registrar
(Mughal Iron & Steel Industries Limited)
M/s. THK Associates (Pvt.) Limited
D.H.A, Phase-VII, Karachi, Pakistan
NOTE
155
NOTE

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In the dynamic landscape of the steel industry, Mughal Steel has

continued to set new benchmarks by embracing a philosophy that

Scope and Boundary of Forward Looking

Annual Financial Statements

MUGHAL IRON & STEEL INDUSTRIES LIMITED

Profit Before Taxation

Earnings per Share Profit for the Year

25,372 Rs. in Millions

59,832 per Share

MUGHAL IRON & STEEL INDUSTRIES LIMITED

MUGHAL IRON & STEEL INDUSTRIES LIMITED

MUGHAL IRON & STEEL INDUSTRIES LIMITED

and Ethics Fair and Ethical Competition

Culture compensating all employees.

Our culture demonstrates the manifestation of shared values Teamwork

MUGHAL IRON & STEEL INDUSTRIES LIMITED

Laws & Fairness

MUGHAL IRON & STEEL INDUSTRIES LIMITED

The management team is being led by Mr. Khurram Javaid,

Major Product Portfolio

• Steel re-bars (G60 / Mughal Supreme)

Relationship with Group

MUGHAL IRON & STEEL INDUSTRIES LIMITED

One Stop Sale

MUGHAL IRON & STEEL INDUSTRIES LIMITED

Audit Committee D.H.A, Phase-VII, Karachi, Pakistan

Chief Operating Officer

Handling Cell 31 –A Shadman I Lahore, Pakistan

Factory & warehouses

MUGHAL IRON & STEEL INDUSTRIES LIMITED

Pakistan Credit Rating Agency and VIS Credit Rating

Pakistan Credit Rating Agency VIS Credit Rating Company Limited

Long-Term A+ (A Plus) Long-Term A+(A Plus)

Short-Term A1 (A One) Short-Term A-1 (A One)

Market Price Data

July 63.90 52.00 107.90 99.30

August 71.25 53.11 116.00 101.99

September 69.50 61.05 121.50 93.05

October 72.40 60.02 101.39 77.50

November 66.00 56.40 109.75 90.20

December 58.05 45.70 105.00 85.05

January 51.80 41.03 111.49 100.00

February 55.00 45.10 114.60 91.00

March 58.30 45.69 98.90 81.51

April 53.90 47.50 93.00 76.51

May 54.95 46.40 77.90 59.65

June 53.61 45.50 65.92 52.31

MUGHAL IRON & STEEL INDUSTRIES LIMITED

Accounts Retail Sales - Bar Sales - Girder / Waste

Taxation Business Development Internal Logistics

Procurement General Stores -

Information Procurement General Stores -

Procurement - Imported Raw-

MUGHAL IRON & STEEL INDUSTRIES LIMITED

Imported Raw Karachi Port

Melting - Steel Billet Re - Rolling Finished Products:

Large Infrastructural Projects - Re-

Feed Stock Copper Granule

Feed Stock Melting - Copper Ingot Karachi Port Export

MUGHAL IRON & STEEL INDUSTRIES LIMITED