PACRA Maintains the Rating of TPL Trakker Limited | Sukuk

TPL Trakker Limited (or the "Company") is in the business of providing superior quality GPS, GSM & Satellite Mobile Asset Tracking Management, and Information Solutions. The assigned rating takes into account the Company’s prominent position in Pakistan’s tracking industry, emanating from its multifaceted product portfolio and sanguine technology infrastructure. As diversity becomes inevitable to sustain in its operating segment, the Company is gradually shifting toward business avenues that are more beneficial for the Company’s growth. The new segments have already achieved above par results, however, incremental yet consistent cash flows remain pivotal. With a niche service area like Digital Mapping and location services, the Company is focused on innovations, partnerships, product development, and direct business development – both in B2B and B2G, to drive stable and sustainable growth for the rest of the year. During the nine-month period ended on Mar'23, the Company reported topline of PKR ~1.69bln (Mar'22: PKR ~1.50bln). While the loss of the Company increased to PKR (~0.08)bln whereas in Mar'22, it stood at (~0.07)bln.
The ratings are dependent upon the strength of the underlying security of the instrument. The instrument is secured through a tiered security structure. In addition to this, specific comfort to the assigned ratings is being drawn from the inclusion of a pre-default mechanism, comprising a facility payment account and facility service reserve account in which one installment will be maintained.

About the Entity
TPL Trakker Limited (TPLT) – is a Public Listed Company which is majorly (64.32%) owned by TPL Corp Limited. TPLT is a telematics solution provider and the core business mainly comprises vehicle tracking, fleet management, Internet of things (IoT) and Digital mapping services. BoD of the Company comprises eight members, headed by the Chairman Mr. Jameel Yusuf. Mr. Harris Jamali is the CEO of the Company, having more than a decade of experience and has joined TPL Trakker Limited in November 2022.

About the Instrument
TPL Trakker Limited has issued a secured, OTC listed & Privately placed Sukuk of the amount PKR 1.25bln in March 2021. The instrument carried a profit rate of 3MK+300bps with a tenor of five (5) years (inclusive of a 6months grace period). The purpose of the Sukuk is to meet the Company's working capital requirement, investment in group companies, and partial debt repayment. Sukuk will be redeemed after eighteen (18) equal quarterly payments in March 2026. Currently, the principal of PKR ~69.4mln and markup of PKR ~46.09mln has been paid at the end Dec'22 and PKR ~69.4mln and markup of PKR ~44.7mln has been paid at the end of Mar'23.