Service Industries retains 'AA' long-term rating, outlook stable

According to Mettis Global, PACRA has affirmed Service Industries Ltd (SRVI) at 'AA' over the long term and 'A1+' over the short term, keeping the outlook stable. The decision leaves both ratings and the outlook unchanged from the review on September 19, 2025.

Consolidated revenue rose about 18.7 per cent in CY25 to Rs148.4bn, up from Rs125.0bn a year earlier. Lower borrowing costs lifted net margins, while raw material cost pressures squeezed gross and operating margins. The rating reflects an improving financial risk profile, although the capital structure remains leveraged because of concessionary, TERF-linked borrowing for expansion.

Service Long March Tyres (SLM) is moving ahead with a passenger car radial plant, and proceeds from its IPO are earmarked for that project. Group exports accounted for roughly 30 per cent of consolidated turnover in CY25. Domestic footwear retail, with 286 outlets, has levelled off as openings are offset by closures.