Suhail Jute Mills Faces Revival Challenges Amid Funding and Land Sale Delays

Suhail Jute Mills Limited (PSX: SUHJ) continues to face significant obstacles in securing working capital and settling creditor liabilities, delaying the restart of its commercial operations.

As detailed in the company’s Progress Report, a key element of its revival plan—a 20-acre land sale—has been hindered by ongoing political and economic instability, particularly in Khyber Pakhtunkhwa. The sale was projected to generate Rs 480 million, which would fund the development of 576 kanals of smaller industrial plots, estimated to bring in Rs 2.5 billion in revenue.

The revival strategy, approved by the Securities and Exchange Commission of Pakistan (SECP) in April 2023, depends heavily on these land sales to address financial obligations and secure working capital. Although Suhail Jute Mills possesses a fully operational jute manufacturing facility, production remains stalled due to insufficient financing.

The company acknowledged the continued financial backing from its principal sponsors, who have provided funds to sustain operations during this challenging period.

Despite expressing cautious optimism about improving economic stability and declining mark-up rates, Suhail Jute Mills emphasized that its future hinges on overcoming the hurdles in land sales and funding to restart production and restore stakeholder confidence