Panther Tyres Limited Dec 18, 2021

Submitted To:
Mr. Saif Toor
Management of Financial Institution

Submitted By:
Ali Haidar 1847104
Maalik Ul Ashtar 1847118
Muhammad Hamza 1847121
Talha Farooqui 1847137

Date: 18th Dec 2021

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Panther Tyres Limited Dec 18, 2021

Table of Contents
Panther tyres limited (Mian Tyre and Rubber Company Limited)...............................................................................1
Board of Directors of Panther Tyres Limited...........................................................................................................1
About the issue........................................................................................................................................................1
Principal purpose of the issue..................................................................................................................................1
Source of Finance....................................................................................................................................................2
Financial Performance.............................................................................................................................................3
Debt to Equity......................................................................................................................................................3
Total Asset Turnover............................................................................................................................................3
Liquidity Risk........................................................................................................................................................3
Earnings per Share...............................................................................................................................................3
Growth in sales....................................................................................................................................................3
Net Profit.............................................................................................................................................................4
Marketing Strategy..................................................................................................................................................4
Advertisement of issue of IPO.................................................................................................................................4

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Panther Tyres Limited Dec 18, 2021

Panther tyres limited (Mian Tyre and Rubber Company Limited)

Panther Tyres Limited was established in 1983 as a tyre and tube producer. On October 24, 1983, the Company was
incorporated as a private limited company under the Companies Act 1913. On October 10, 2003, it was converted to a
public limited company under the Companies Ordinance 1984 now known as Companies Act, 2017.On October 25, 2011,
the company renamed itself Panther Tyres Limited from Mian Tyre and Rubber Company Limited. The productions plant
of the company is located on Sheikhupura Road, 29.5 kilometres distant, and covers an area of 168.6 kanals (freehold
land). In the tyre and tube market, the company has developed to become one of Pakistan's top players. In April of 2018,
the Company began trading automotive fluids and motorcycle replacement parts in addition to its principal activity.
Motorcycle engine oil, as well as diesel engine oil for tractors, large transport vehicles, lifters, and generators, is sold by
the company.

Board of Directors of Panther Tyres Limited

Mian Iftikhar Ahmed: Mian Iftikhar Ahmed is holding the position of Chairman of the Board of Directors.

Mian Faisal Iftikhar: He is an Executive Director and heading the Company as a Chief Executive Officer.

Zahid Mehmud: Mr. Zahid is serving as an Executive Director in Panther Tyres.

Samina Iftikhar: Samina Iftikhar is associated with the Company as a Non-Executive Director since 2012

Javed Masud: Mr. Javed is the independent director of the Company. 

Asad Sultan Chaudhry: He is associated with the Company as an independent director.

Iqbal Ahmed Khan: Mr. Iqbal Ahmad Khan, is associated with the Company as an Independent Director.

About the issue

The issue includes 40,000,000 Ordinary shares with a face value of PKR 10/- each. Panther Tyres Limited is issuing
30,000,000 (i.e. 21.42 percent of Panther Tyres Limited's total post-IPO paid up capital) ordinary shares, while Mian
Iftikhar Ahmed, the company's sponsor, is offering 10,000,000 (i.e. 7.14 percent of Panther Tyres Limited's total post-
IPO paid up capital) ordinary shares from his current shareholding. The Total 40,000,000 Ordinary Shares will be offered
through the Book Building method at a Floor Price of PKR 47.00/- per share with a price band of 40% above the floor
price, i.e. Rs. 65.8.

Bidders may put bids for one hundred percent (100%) of the Issue size, and the Strike Price is the price at which one
hundred percent (100%) of the Issue is subscribed. However, if they get successful only seventy-five percent (75%) of the
Issue size, i.e. 30,000,000 shares, with the remaining twenty-five percent (25%) i.e. 10,000,000 shares being offered to
retail investors.

Principal purpose of the issue

The new issuance will be used to fund the Company's expansion initiative. The purpose of the extension project is to
enhance the production capacity of Tyre Sets and Tubes (Packed). Cutting-edge machinery is being brought in to help
with this development. In all sections of Tyre Sets and Tubes, the Company has reached its full operational capacity
throughout time (Packed). In the tyre segment, the company is at 82.6% capacity, and in the tube segment, it is at more
than 92% capacity. With each passing year, the demand for tyres and tubes grows. The Company has made the following
choice in order to meet future demand for tyres and tubes in both the domestic and international markets expansion of

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Panther Tyres Limited Dec 18, 2021
project is most important thing because this will not only to enhance Tyre Sets and Tubes (Packed) production capacity,
but also to introduce modern tyre manufacturing technology.

Panther Tyres plans to import Comerio Ercole's latest and most advanced 4 Roll Calender Line (Italy). With that they will
be able to produce good quality products with high product thickness accuracy also minimizing the wastages with the
introduction of this latest Calender Line in the Company's Calendering department for production of radial tyres. As a
result, if the company wishes to produce radial tyres in the future, it will not require the installation of a new calender
line. Panther Tyres also plans to bring in a Farrel Limited fully automated Banbury Mixer (UK). Looking at tyre industry
mixing is the initial step and most critical component of rubber processing. The mixing operation produces a product with
evenly disseminated and distributed ingredients, which is then processed in succeeding phases to cure efficiently and
offer the appropriate attributes for the end application. As these fully automated Banbury Tangential Mixer in the
Company’s mixing department will definitely improves the efficiency and will reduce material wastages.

The Table 1 shows that the Company’s production capacity of Tyre Sets will increase from 8.1 million to 9.8 million,
Tubes (Packed) from 31.2 million to 42 million. Apart from this, calendaring capacity of the Company will also increase
from 9 million units to 20 million units per annum. The expansion investment will also raise the capacity of mixing
department by 60%.

Table 1
Units in “000” Current Post Expansion % Increase
Capacity Capacity
Tyre Sets 8,100 9,800 21.0%
Tubes (Packed) 31,200 42,000 34,6%
Mixing Department (“000” 45,000 72,000 60%
Kgs)
Calender 9,000 20,000 122.2%

Source of Finance
The Company proposes to issue 30,000,000 ordinary shares at a floor price of PKR 47/- per share through the New
Issuance to raise PKR 1,410 million at the Floor Price. The estimated PKR 3,066 million expansion cost will be covered
by a combination of debt and equity, with a Debt to Equity ratio of 39.1: 60.9.

Break up of fund requirement Funds (PKR) % Contribution

IPO Proceeds 1,410,000,000 46.0%
Long Term Bank Financing 1,200,000,000 39.1%
Cash flows of the Company 456,173,839 14.9%
Total Funding requirement 3,066,173,839 100.0%

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Financial Performance
Debt to Equity
Debt to Equity ratio of the Company increased in FY 2017 to 1.4x from 1.1x in FY 2016 because of the increase in short
term borrowings of the Company. Increase in short term borrowings of the Company was attributed to increase in
working capital requirements of the Company. In 2021, debt to equity ratio of the Company decreased to 0.9x from 1.1x
in FY 2020. Improvement in debt-to-equity ratio of the Company is attributed to reduction in short term borrowings of
the company

Total Asset Turnover

The asset turnover ratio, also known as the total asset turnover ratio, is a metric that assesses how efficiently a company
uses its assets to generate revenue. The asset turnover ratio is calculated by dividing net sales by a company's total or
average assets. When compared to competitors with a lower ratio, a company with a high asset turnover ratio performs
more effectively. If we look at the graph so it illustrates that the ratios are increasing at the constant rate and the highest
ratio is in 2021 with 1.39.

Liquidity Risk
The risk of not being able to meet financial obligations owing to a lack of liquid assets is known as liquidity risk. Panther
Tyres' commercial prospects, operations, and financial situation would suffer if the company was unable to service its
debt commitments on schedule or meet its financial and other covenants. According to the Company's financial accounts
as of September 30, 2020, total current assets are PKR 4,900 million, with current liabilities of PKR 4,230 million,
resulting in a current ratio of 1.15x, indicating that the Company has the resources and ability to satisfy its current
obligations. And in 2021 the total current assets are PKR 8,000 million, with current liabilities of PKR 5,000 million,
resulting in current ratio of 1.6x which shows a greater change.

Earnings per Share

Earnings per share (EPS) is calculated by dividing a company's net profit by the number of outstanding common shares.
Investors will pay more for a company's shares if they believe the company's profits are higher than its share price, so a
higher EPS signals more value. If you look at the stats so the highest earning per share is 7.06 in 2021 which shows profit
after tax is resulting more values than in preceding years.

Growth in sales
Growth in OEM Sales, Growth in Replacement Market Sales and Growth in Export Sales are key elements for Panther
tyres limited. As we discussed above about the Maximum Capacity that they are producing resulting in increase of sales

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in future they are assuming that if they install new machineries that might increase their sales to PKR 18000 million in
2022.

Net Profit
The sales of Rs.16,202 million as against sales of Rs.11,584 million reported in last year. The net profits of the Company
remained at Rs.851 million as compared to that of Rs.252 million earned in last year. Which will definitely attract the
investors.

Marketing Strategy
Panther Tyres is the leader and innovator in Motorcycle and Rickshaw tyre categories. The Company’s marketing side is
mainly focused on creating top of mind recall through cost effective and impactful marketing campaigns through
electronic media advertisement (News, Entertainment, Sports channels and Radio), social media and other mass mediums
through product based advertisement.

Moreover, Panther Tyres is investing in their logistics channels to make them better which includes distributors,
wholesalers, retailers and influencers like vulcanizers for maximum brand endorsement and acceptance at community
through information sessions and other engagement programs for product trial and brand loyalty. The Company is
focusing on in shop branding and promotions at national level to pursue the high brand visibility and increased good
brand image.

Panther Tyres has maintained a long standing relationship with key OEMs in Pakistan wherein the company has been
supplying Tyres and tubes to Suzuki, Honda and Yamaha for more than 26 years. The Company derives 25% of its total
sales from supplies to OEMs

Panther Tyres current and future marketing strategies are aimed at gaining high market share and mind share through
ATL and BTL activities so that it becomes the brand of choice among our diverse customer base.

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Advertisement of issue of IPO

The advertisement is the key factor, it is important to let the investors know about the issue of IPO before hand so
that more subscribers can be obtained, for the we would use multiple mediums to advertise our IPO:

 Ads & Blogs on website: We will post ads and blogs at our company’s official website and would also
mention in investor information section of our website. Moreover, we would also post ads on the social
media accounts in order to attract mass audience.
 Newsletter on PSX website: We would post ads on the daily newsletter of PSX (Pakistan Stock Exchange)
websites, so the investors who follow PSX would know about the issue.
 Ads on print media (Newspaper): We will post ads in multiple newspaper i.e., Dawn, Jang, The Nation,
The daily times etc., in major cities i.e., Karachi, Lahore, Islamabad.
 Flyers at banks: We will keep flyer and subscription letters at our major banks i.e., Bank Alfalah Limited,
Faysal Bank Limited, Meezan Bank Limited, National Bank of Pakistan etc.,

Dates of issue
Registration of eligible investors: The registration of eligible investors will commence on January 22, 2022 and on
January 28, 2022

Bidding period dates: From January 27, 2022 to January 28, 2022

Date of public subscription: From February 03, 2022 to February 04, 2022 (both days inclusive)

Date of Publication of this Prospectus: January 18, 2022

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