Strength at Interloop despite choppy waters
Pakistan-based denim and textiles manufacturer Interloop recorded an 11% increase in sales, reaching PKR 125.408 billion ($445 million) for the nine months ending March 31, 2025.
However, this revenue growth did not improve profitability during the accounting period. The company’s gross profit shrank by 27%, falling to PKR 24.6 billion. The company attributed this to rising input costs, a stagnant exchange rate, increased financial charges due to higher working capital needs, and the gestation period for the recently launched apparel master project, which impacted the profitability despite significant sales.
However, the financial performance in the third quarter of FY2025 showed an improvement in profitability compared to the previous quarter. With a stable % gross profit margin of 20.1%, the company achieved a 16.2% increase in net profit, reaching PKR 1.3 billion.
AKD Research, evaluating ILP’s results, notes that the company has strong potential for growth, supported by its competitive product portfolio and ongoing expansions in the hosiery, denim and apparel segments. While there are near-term challenges due to uncertainties surrounding potential tariffs imposed by the US, the research firm expects ILP to maintain its long-term growth trajectory.
The company’s management anticipates a dynamic operating environment in FY2026, characterised by opportunities and challenges. Domestically, macroeconomic stability is gradually improving, while global volatility continues due to geopolitical tensions and shifting trade dynamics. The US recently announced reciprocal tariffs, which are now paused for 90 days, creating short-term uncertainty. These tariffs could reduce US in-house demand and impact export sales if implemented. However, Pakistan may maintain a competitive advantage, as similar or steeper tariffs have been imposed on major regional competitors, including China, Bangladesh, Vietnam, Cambodia and Indonesia. Nonetheless, global demand is expected to remain subdued, with buyers exercising caution.
Additionally, Interloop is pursuing a multi-faceted strategy by expanding into new markets, improving operational efficiencies, managing input volatility and aligning with global ESG (Environmental, Social, and Governance) standards. The company is advancing its sustainability initiatives in FY2026 through strategic partnerships. Collaborating with Reverse Resources allows for digitised tracking and recycling of pre- and post-consumer textile waste, enhancing supply chain traceability in Pakistan.
Additionally, Interloop supports ALIF’s ECO-Schools program, which helps educators incorporate sustainability into their curricula and develop future environmental leaders. The company’s efforts were recognised at the 2024 Just Style Excellence Awards, where it was honoured for Business Expansion, Innovation and Environmental leadership.
