The Pakistan Credit Rating Agency Limited
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Muneeb Rashid

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PACRA Assigns Positive Outlook to IFS Rating of Asia Insurance Company Limited

Rating Type IFS
Action Maintain Maintain
Long Term A- A-
Short Term - -
Outlook Positive Stable
Rating Watch - -

The rating draws strength from company`s strong operating platform, streamlined organizational structure, and improved HR base. ASIC is making sustained progress towards defined business goals - amidst tough competition. The company has achieved sizeable business volume with considerable growth. The business plan envisages further penetration into the market on the back of extended branch network, exploring both general and takaful avenues. Company's real estate project - Asia House - is complete, while prospective tenants have been identified. Meanwhile, inflow of stable stream of rental income (Asia House), expected to commence in CY17, would supplement the bottomline. The rating takes comfort from risk absorption capacity, emanating from liquidity adequate for current risk profile, that also provides stable investment income.

Positive outlook takes into account company's ability to achieve growth targets. Requisite market share, while ensuring profitability, would benefit the rating. Risk absorption capacity, characterized by strong liquidity position, should be improved alongside business growth.

About the Entity
Asia Insurance Company Limited (ASIC), established in 1979 as a general insurance company, is listed on the Pakistan Stock Exchange. The free float has been limited and the company is almost entirely owned (~98%) by Mr. Ihtsham ul Haq Qureshi and family. ASIC, with its Head Office in Lahore, operates a network of 22 branches across the country. The company started window takaful operations in Aug-15.

ASIC's Board of Directors comprises seven members. In addition to the CEO, there are three members from the sponsoring family including one executive director. Of the remaining three members, two are independent and one executive. The CEO of the company, Mr. Ihtsham ul Haq, brings with him over two decades of experience in the insurance sector. He is assisted by an able team.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.