The Pakistan Credit Rating Agency Limited
Press Release


Muneeb Rashid

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

The rating reflects CSInsurance's strategy to focus on direct line personal insurance in motor and health segments, targeting small ticket clients. The company has shredded its corporate health portfolio - amid high losses. This enabled the company to improve underwriting performance, though expense ratio is still alarmingly high. The company's liquidity profile matches the risk parameters for current size of business operations, however, going forward with rising business, improvement in liquidity profile is essential. CSInsurance is fast moving towards a holding company structure through building its non-insurance strategic book. The company has completed deployment of sizeable funds in Dost Steels Limited (DSL), funded through internal sources and fresh equity injection; herein, management of associated risks will be important. Moreover, it has entered FMCG sector - CSFoods and CSLuxury. While, CSTechnologies is aimed at providing group support. To further expand its footprint in the retail business, CSInsurance injected fresh equity through way of right issue.

The rating watch has been removed post successful commissioning of DSL operations. CSInsurance holds major stake in DSL, herein, smooth running of operations and consequent turnover build-up is critical. Meanwhile, risk absorption capacity needs to be kept intact.

About the Entity
Crescent Star Insurance Limited (CSInsurance), a listed company, was established in 1957. In Feb-2013, new management took over the company. The market share is small (CY17: ~0.4%). CSInsurance is majority controlled by group of individuals including two private companies holding 55%. The company's Head Office is located in Karachi, and currently operates a network of 7 branches across the country.

The overall control of the company vests in eight member BoD including the MD. The Chairman & Managing Director Mr. Naim Anwar, is the key man behind the company; he has been in the general insurance industry for over two decades. He is assisted by an experienced team.

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