By Shams ul Nisa
ISLAMABAD– Gul Ahmed Textile Mills Limited (GATM) is advancing its sustainability agenda with a major expansion in renewable energy (RE), reports WealthPK.
Gul Ahmed’s Expansion in Renewable Energy
The company has implemented a 2 MW rooftop solar power system and plans to add another 17.2MW by the end of FY25.
Rising Energy Costs and the Shift to Renewable Energy
In 1HFY25, the company’s fuel and power expenses surged to Rs7.2 billion, driven by a sharp increase in gas tariffs for Captive Power Plants (CPPs). Therefore, in the face of rising energy costs, the GATM is accelerating its shift toward renewable energy to enhance sustainability and efficiency.
Thus, these initiatives are expected to cut the electricity expenses and reduce the company’s carbon footprint. Moreover, the company is also evaluating further solar expansion of 10-15 MW and a large-scale battery storage system to ensure uninterrupted operations, reinforcing its commitment to energy independence and environmental responsibility.
Strong Revenue Growth Despite Challenging Conditions
The company delivered a strong revenue growth in 1HFY25 despite a challenging operating environment. The net sales climbed 18% year-on-year to Rs81.6 billion, driven by a 16% increase in direct exports (22% in USD terms) and a 14% rise in local sales, reflecting a strong domestic demand.
Impact of Higher Production Costs on Profitability
However, higher production costs and rising finance expenses weighed on profitability, leading to a 22% decline in profit after tax to Rs1 billion. While the gross profit margins remained solid at 9.6%, the inflationary pressures and energy costs posed challenges to overall earnings.
Exploring Biomass Co-generation and Sustainable Manufacturing
Thus, the GATM is strengthening its commitment to sustainability by expanding its renewable energy initiatives. Beyond solar power projects, the company is exploring the installation of a biomass cogeneration plant that would use agricultural waste to generate electricity and steam, reducing dependence on fossil fuels.
These efforts align with the global sustainable manufacturing trends and reinforce the GATM’s position as a pioneer in green innovation in Pakistan’s textile industry.
Addressing Challenges in Pakistan’s Textile Sector
The textile sector, which drives over 60% of Pakistan’s exports and plays a vital role in employment and economic growth, faces mounting challenges from the rising energy costs and global competition. Hence, the GATM is investing in renewable energy to enhance its competitiveness and set a sustainability benchmark for the industry.
International Recognition and Eco-Conscious Markets
The company’s green initiatives have gained international recognition, attracting buyers who prioritize environmentally responsible suppliers. This shift is expected to strengthen the company’s global partnerships and unlock new opportunities in the eco-conscious markets.
Long-Term Growth Strategy and International Partnerships
Therefore, the GATM remains committed to expanding its renewable energy portfolio as part of its long-term growth strategy. The company is actively seeking partnerships with international organizations and financial institutions to support additional green projects, aiming to enhance energy efficiency while contributing to Pakistan’s environmental goals.
Reinforcing Leadership in Sustainable Manufacturing
By investing in solar power and innovative solutions such as biomass co-generation, Gul Ahmed is reinforcing its leadership in sustainable manufacturing while strengthening its financial resilience in an increasingly competitive market.
