PACRA Maintains the Entity Ratings of Global Marketing Services

Global Marketing Services (GMS or “the Company”) has established a strong reputation within the clinical and medical laboratory equipment sector, which plays a crucial role in healthcare diagnostics. GMS operates through two distinct business divisions, Clinical and Medical, encompassing a diverse range of products including core and molecular diagnostics, Onco DX, medical and hospital solutions, and clinical genomics. The Clinical Division contributed ~65% to the topline during FY25 and focuses on laboratory diagnostic and testing equipment, while the Medical Division contributed around 35% to the topline during FY25 and primarily specializes in equipment related to cardiology, electrophysiology, surgical connections, and infection prevention technologies. The Pakistani diagnostic equipment market continues on an upward trajectory, supported by growing public awareness and greater accessibility to advanced diagnostic procedures, with multinational players such as Siemens Healthineers, Abbott, Roche Diagnostics, GE Healthcare, and Philips operating across the sector. The assigned rating reflects the sustainability of the Company’s topline, which remained stable in FY25 amid the imposition of a revised sales tax on previously zero-rated medical devices that increased costs and affected overall demand. Management expects this impact to be recovered and absorbed through pricing adjustments by FY26. Despite topline stagnation, the Company improved profitability margins at all levels by effectively managing finance costs and maintaining performance in the face of increased competition from new Chinese entrants in the market. The rating also derives comfort from the Company’s strong relationships with over 15 globally recognized principals, including Biomerieux, Abbott Medical, Cordis, Johnson & Johnson Medical, and Steris Corporation, as well as a robust customer base comprising esteemed healthcare institutions in both the public and private sectors. The addition of the Abbott Medical portfolio has been instrumental in driving sales growth in the Medical Division, and management anticipates further gains in sales volume and profitability through this partnership. GMS’s sponsors have decided to corporatize both business divisions under a single consolidated entity, with the process already underway and expected to be completed by the end of FY26, marking the transition to Global Marketing Services (Private) Limited. The Company currently works with 29 distributors across Pakistan and plans to expand its network further. The control environment is adequate, with an internal audit and compliance function that conducts regular audits to ensure adherence to established quality standards. As GMS imports all of its inventory, it remains exposed to currency fluctuations and related foreign exchange risks; however, the Company mitigates these risks through long-term contracts with major customers, allowing products to be priced in line with prevailing USD exchange rates. The current governance structure, while functional, lacks formal board committees and independent oversight, leaving room for improvement. The overall financial risk profile is supported by adequate cash flows, coverage metrics, and a stretched working capital cycle. The capital structure remains non-leveraged, relying primarily on non-funded facilities for the establishment of LCs.
The ratings are contingent on the firm’s ability to sustain its top line, maintain profitability metrics, and generate sufficient cash flows to support growth. Successful execution of the proposed business and corporatization plan is critical, while continued improvement in the governance structure remains imperative.

About the Entity
Global Marketing Services (GMS), established as a partnership in 1999, has over two decades of experience in healthcare, expanding across diagnostic and life science segments through exclusive alliances with leading global principals in invitro diagnostics, transfusion medicine, and medical devices. Ownership is split between two divisions: in the Clinical Division, Mr. Zafar Mehmood holds 68 percent, Mr. Muhammad Ayub 20 percent, and Ms. Naheed Dilshad 12 percent, while in the Medical Division, Mr. Zafar Mehmood holds 58 percent, Ms. Naheed Dilshad 32 percent, and Mr. Muhammad Ayub 10 percent.