Millat Tractors responds to reports of vendor supply disruptions

Millat Tractors Limited (MTL) has officially denied recent media reports suggesting that vendors have halted the supply of tractor parts to the company. 

The news, which was published in a segment of print media on August 9, 2024, claimed that supply disruptions were impacting MTL’s operations.

In a statement released to the Pakistan Stock Exchange (PSX) on August 12, 2024, MTL clarified that no vendor has ceased operations, and the company would promptly inform the stock exchange if such an event were to occur. 

However, the company noted that tractor sales are subject to 18% GST and GST on all inputs is charged as 18% resulting in a continuous stream of refunds and FBR has not issued any mechanism for payment of refund claims yet. 

MTL has already applied for indemnity from FBR in this regard, and as such, MTL is continuing with its operations, it said.  

However, sales and bookings are limited due to the liquidity impact on agri-loan customers. As a result, the CBU inventory is piling up and company capital is squeezing. 

MTL warned that if the situation persists and the FBR continues to delay the clarification and processing of refunds, the company may be forced to consider halting production.

The company has assured stakeholders that it remains committed to its operations despite the current challenges and will continue to monitor the situation closely.