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Business Recorder
10 hours ago
- Business
- Business Recorder
Pakistan's Interloop expands global footprint with acquisition of Bonnie Doon brand
Textile Hub B.V., an associate company of Interloop Limited, one of Pakistan's largest textile exporters, has acquired the global rights to the Bonnie Doon brand, a well-established legwear label. The acquisition includes all related global trademarks, inventory, and e-commerce infrastructure, marking a strategic expansion move by the company, Interloop said in a notice to the Pakistan Stock Exchange (PSX) on Wednesday. 'We are pleased to inform that Textile Hub B.V., an Associate Company of Interloop Limited, has acquired the Bonnie Doom brand, an established and reputable legwear label, from Bonnie Doon B.V. This acquisition encompasses the global trademarks for the brand Bonnie Doon®, along with associated inventory and e-commerce infrastructure,' read the notice. Bonnie Doon is originally an American sock brand, founded in 1957 by Alex Lee Wallau, the company's website reads. 'Since 1969, the brand has been introduced to the Dutch and European markets.' Pakistan's textile giant Interloop sees 70% profit drop in 2QFY25 Additionally, BonnieDoon® is also renowned for its design and production of private labels and custom-made legwear. Meanwhile, Interloop, established in 1992, is a vertically integrated, multi-category company that manufactures hosiery, denim, knitted apparel and activewear. In addition, it produces yarn for textile customers. It is also one of the largest exporting firms in Pakistan and among the largest listed companies on the PSX. All of its plants are located in the province of Punjab. As per the consolidated financial results for the nine months ended March 31, 2025, Interloop earned a consolidated revenue of Rs130,541 million, showing a 14.3% increase from the corresponding period of last year. However, the net profit fell by 78.4% from Rs13,987 million to Rs3,028 million.
Express Tribune
03-04-2025
- Business
- Express Tribune
US tariff to hit Pakistan textile industry hard
Pakistan, which had considered itself unharmed by the US tariff war, based its outlook on the fact that US President Donald Trump's previous tariffs had not targeted Pakistan, has now been caught off guard by the US's 29% tariff. This will significantly impact its export sector, particularly the already stagnant textile industry. The result will be a severe blow to exports, foreign reserves, and employment, further exacerbating the country's economic challenges. The country had even considered inviting Chinese factories to relocate in order to avoid the tariffs imposed on China. However, this effort failed in the past due to an unfriendly business environment and political instability caused by the ongoing power struggle between politicians and the establishment. The United States has imposed reciprocal tariffs on its trading partners, including Pakistan, to boost domestic manufacturing and generate revenue. These tariffs range from 10-48%, in addition to a universal 10% tariff applied to all countries. In 2024, US imports totalled $3.36 trillion, reflecting a 6% year-on-year (YoY) increase, according to Trade Map. Mexico was the largest contributor to US imports (15%), followed by China, Canada, Germany, and Japan, with shares ranging from 5-14%, according to Topline Securities. In contrast, Pakistan's share was a mere 0.16%, compared to Vietnam (4.2%), Bangladesh (0.26%), Sri Lanka (0.09%), and India (2.7%). Despite its small share in US imports, the US remains Pakistan's single largest export destination, accounting for $6 billion annually, or 18% of Pakistan's total exports. Textile industry faces tariff challenges Textiles constitute 75-80% of Pakistan's exports to the US, with other exported goods including leather, surgical instruments, rice, cement, steel products, and salt. Pakistan's textile exports compete primarily with China, India, Vietnam, Cambodia, Indonesia, and Bangladesh. The imposed tariffs on textile exports vary: China (34%), Vietnam (46%), Sri Lanka (44%), and Bangladesh (37%) face higher tariffs than Pakistan (29%), while India benefits from a slightly lower tariff (26%). Pakistan and India export similar textile products (product codes 61, 62, 63, and 52), meaning India holds a competitive advantage due to its lower tariff rate. Conversely, higher duties on Bangladesh and Vietnam provide some relief to Pakistan's textile exports. However, with higher tariffs on China, Vietnam, and Bangladesh, these countries may shift their focus to the European market, intensifying competition for Pakistan's exports in that region. Companies affected by US tariff Key Pakistani textile companies affected by US tariff policies include Interloop Limited (ILP), Feroz Mills (FML), Kohinoor Textile (KTML), Nishat Mills (NML), and Gul Ahmed (GATM). Outside the textile sector, companies such as Service Global Footwear (SGF), Matco Foods (MFL), Fast Cables (FCL), International Steels (ISL), International Industries (INIL), DG Khan Cement (DGKC), Power Cement (POWER), and Mitchells Fruit Farms Limited (MFFL) also have US exposure. Additionally, Pak Elektron (PAEL) has recently started exporting transformers to the US, according to Topline Se. Trade balance, export breakdown Pakistan's trade balance with the US remains in surplus. In FY24, Pakistan exported $5.44 billion worth of goods to the US while importing $1.88 billion, resulting in a trade surplus of $3.57 billion, according to AHL. This was a slight decline from FY23's $3.72 billion surplus due to a 6% drop in exports and an 8% reduction in imports. As of FY25 to date, the surplus stands at $2.51 billion, with exports at $4.01 billion and imports at $1.50 billion. Textiles continue to dominate Pakistan's exports to the US, accounting for 91.9% of total exports in FY24, amounting to $5 billion. In the first eight months of FY25, textile exports totalled $3.7 billion, increasing their share to 92.8% despite an overall decline in exports. The food sector's contribution dropped slightly from 3.3% in FY24 to 3.2% in FY25, while the steel sector remained stable at around 1%. Cement exports, though minor, increased from 0.3% in FY24 to 0.5% in FY25. Mitigation strategies for Pakistan To mitigate the impact of the 29% US tariff hike on Pakistan's exports, particularly in the textile sector, the country needs a strategic, policy-driven response. Key strategies include negotiating reciprocal trade agreements to reduce tariffs on exports, especially textiles, and lowering duties on US imports like raw cotton to maintain competitiveness.
