The Pakistan Credit Rating Agency Limited
30-Jun-18
Analyst
Raniya Tanawar
raniya.tanawar@pacra.com
+92-42-35869504
www.pacra.com
Applicable Criteria
- Methodology | Corporate Rating Methodology | Jul-17
- Methodology | Correlation between long-term and short-term rating scale | Jun-17
Related Research
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PACRA Upgrades Entity Rating of Etimaad Engineering (Pvt.) Limited
| Rating Type | Entity | |
|
Current (30-Jun-18 ) |
Previous (10-Jan-18 ) |
|
| Action | Upgrade | Maintain |
| Long Term | BBB- | BB+ |
| Short Term | A3 | A3 |
| Outlook | Stable | Stable |
| Rating Watch | - | - |
The ratings demonstrate Etimaad’s strength which stimulates from its sustained operational history. The business has optimal mix of contracts in its domain and has managed to complete reasonable number of contracts in Pakistan. The pipeline is healthy; therein for the sake of sustainable long term growth, management follows a balanced approach aiming to gain more share in maintenance business. Management efforts to recover previous years losses is yet to materialize, which is a drag. Company is adequately leveraged and determined to reduce its conventional borrowing over a short term horizon. The performance of the company rests with projects in hand and timely completion. The sponsors have demonstrated their commitment by operationally supporting the business by providing security and personal guarantees to obtain financial facilities. Meanwhile, strengthening of business development structure by inducting expert and experienced professionals is considered a key catalyst for upcoming projects.
Rating is dependent upon several contracts successfully completed and upcoming projects undertaken by management to streamline its business for improved profitability, which is pivotal for considerable growth.
About
the Entity
Established by a team of professionals in May 2007, Etimaad is an integrated engineering and contracting company. The company is engaged in providing turnkey, retrofit and debottlenecking solutions for power/oil & gas sector, project management, general industrial construction (Civil, Mechanical, E&I), shut-down and turnaround services. Etimaad's three member board is chaired by Mr. Mazharuddin Ansari, who holds 38% shareholding, is a Chartered Mechanical Engineer with more than four decades of experience with renowned local and foreign organizations. Mr. Laeequddin Ansari, the founding Chairman, (along with his family) holds 43% shareholding. Mr. Farooq Hussain Mughal, President & CEO,is a fellow chartered accountant, holds 6% shareholding and is supported by a qualified team.