PACRA Maintains Entity Ratings of TPL Trakker Limited

The ratings incorporate TPL Trakker's (the Company) prominent position in Pakistan’s vehicle tracking industry, emanating from its multifaceted product portfolio and robust technology infrastructure. As an industry pioneer operating for over two decades, the Company was able to achieve synergistic diversification of its portfolio and offers tailored solutions to a wide array of clients and sectors driving a sustainable edge and leading market position in Telematics, Tracking, Internet of Things (IoT), Maps and Data analytics. Vehicle Tracking and monitoring has the largest contribution in the revenues and the performance of this segment relies on the growth of the automobile industry, which remained subdued due to various macroeconomic factors, such as shortages of CKD kits, soaring inflation, high policy rates, and massive rupee depreciation. However, the Company was able to achieve diversification within this segment by introducing new innovative products such as container/shipment tracking, fuel monitoring & optimization and driving operational efficiency, etc. The company has demonstrated continuous market penetration in both heavy and light vehicles, contributing to the significant advancement of major clients in their fleet digitization journey-a field that is still in its early stages in Pakistan. The Company is further complementing its offering with a growing ecosystem of sensors and IoT devices coupled with real-time visibility and analytics across both web and mobile dashboards to provide a seamless customer experience. Overall growth in digital commerce alongside the future development of special economic zones and CPEC projects creates new opportunities. Astra Location Services (Private) Limited a wholly owned subsidiary of TPL Trakker has launched Pakistan’s first native navigation App (Beta) which uses location data and artificial intelligence (AI) to help enterprises to optimize their supply chain and provides hyperlocal solutions, has a promising future and growth prospects. The Company is finalizing the development of two most popular platforms, Supply Intelligence and Fraud Prevention. Development of SaaS platform is on track and will drive significant operational synergies towards the Company. On the operational front, multiple revenue-generating avenues are near completion with a major portion of capital expenditure already incurred. The sponsors have a deep understanding of the business and the Company is led by experienced management. The financial profile of company is demonstrated by a stretched working capital cycle, modest coverages, and cash flows. Due to the increase in the cost of doing business, there is consistent pressure on margins and profits as depicted in FY23. During 1QFY24 margins showed improvement due to a better pricing strategy. Capital structure is leveraged where borrowings are a mix of short-term and long-term. Keeping a view of modest revenue growth the outcome of upcoming projects remains critical.
The ratings are dependent upon the successful translation of upcoming ventures into sustainable revenue streams and positive performance indicators such as retaining sufficient cash flows, profits and margins where adherence to financial discipline is crucial.

About the Entity
TPL Trakker Limited (TPLT) – is a publicly listed Company that is majorly (64%) owned by TPL Corp Limited. TPLT is a telematics and IoT solutions provider and the core business comprises mainly of vehicle and container tracking, fleet management, IoT solutions and Digital mapping services. BoD of the Company comprises eight members, headed by the Chairman Mr. Jameel Yusuf. Mr. Rao Salman is the new CEO of the Company.