PACRA Maintains Rating of TPL Corp Limited- PPTFC

The rating reflects TPL Corp Limited's diverse pool of investments and its evolving structure as a Holding Company. TPL Group entered in the business arena through vehicle tracking and insurance business. The existing investment portfolio is still evolving and has yet to establish consistent revenue stream for the Holding Company. TPL Insurance, a stable entity, is a dividend generating investment on the Corp’s book. TPL Trakker Limited and TPL Properties Limited continues to load more debt, however, remains prominent player in respective sectors. TPL Life Insurance Limited provides complete health and life insurance products. TPL Maps (Pvt) Limited, the only licensed company in Pakistan for mapping and navigation solutions. TPL Rupiya (Pvt) Limited facilitates payments.
On standalone basis, TPL Corp would add more debt on its balance sheet. This, coupled with the rising interest rate scenario and higher finance cost, could exert pressure on the financial profile of the Company and its repayment ability. Resultantly, coverages of TPL Corp are constrained and could face liquidity pressure due to it's dependence on dividend income from underlying investments. The Company intends to issue another debt instrument, Islamic Commercial Paper (ICP), to meet financing requirements of its subsidiaries/associated companies. The rating takes comfort from demonstrated support of the sponsors and their ability to raise funds. Moreover, built in covenants for timely ICP payment including commitment from the Company to have sufficient liquidity at the time of repayment, remains imperative.
The rating depends on the performance of existing strategic investments and execution of their envisaged business strategies. Timely and successful issuance of Islamic Commercial Paper to improve the Company’s liquidity position is pre-eminent for the ratings. Maintenance of adequate resources for repayment remains critic al. The sustained compliance with the security structure of the TFC is crucial.

About the Entity
TPL Corp Limited (formerly known as TPL Trakker Limited) is a public limited company listed on Pakistan Stock Exchange. The Company is principally engaged in making investments in Group and other companies. TPL Trakker Limited was incorporated in Pakistan on December 04, 2008 as a private limited company and converted into public company in 2009 and got listed on Pakistan Stock Exchange Limited on July 16, 2012. The name of the Company has been changed to TPL Corp Limited w.e.f. November 24, 2017.
TPL Corp is majorly owned by its parent company, TPL Holdings (Pvt.) Limited (62%). 6% shares are held by foreign companies and financial institutions. Remaining shares are owned by the general public.

About the Instrument
The Company issued a privately placed Term Finance Certificates (TFCs) of PKR 1.2bln in Dec-17. This carried a markup rate of 3 months KIBOR plus 1.5 percent per annum and are redeemable in 03 equal installments at the end of 12th, 18th and 24th month. 1st installment was repaid in 19-Dec-18, via right shares issue of PKR 300mln. Second installment was repaid on 19-June-19 through funds injected by Sponsors in TPL Corp through TPL Holdings.