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The Pakistan Credit Rating Agency Limited
Press Release

Date
27-Aug-19

Analyst
Muhammad Usman
muhammad.usman@pacra.com
+92-42-35869504
www.pacra.com

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This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Maintains Entity Ratings of Warble (Pvt.) Limited

Rating Type Entity
Current
(27-Aug-19)
Previous
(25-Feb-19)
Action Maintain Initial
Long Term BB+ BB+
Short Term A3 A3
Outlook Stable Stable
Rating Watch - -

Warble (Pvt.) Limited operates in three segments: i) pesticides ii) seeds and iii) fertilizer. The Company is one of the pioneer groups entered in this segment back in 1990s. The Company has reported adequate turnover, with good contribution of each segment, while pesticide remains predominant segment in terms of revenue. Profitability of the company is slight. Warble expanded its operations by entering into different businesses in agriculture industry and achieving operational efficiency. The company's plant is located at Khanewal; near the Company’s home market (Multan) which benefits its cost structure. The ratings take into account the need for improvement in the control environment of the company with emphasis on quarterly accounts. The company has secured its sales by franchise network named "AGROMART" and interacting end consumers. It meets its working capital requirements through a mix of internal cashflows and short term borrowings. However, the financial risk remains good on account of low long term finance and adequate coverages. Going forward, the improvement in bottom-line and cash flows, standardization in governance structure and financial transparency is vital. The ratings also take into account the sponsor strength as AllahDin group has interests in diversified segments of agriculture for more than 2 decades.
The ratings are dependent on improvement in business and financial profile of the company. Any deterioration to topline, margins and/or cash flows remains critical to the ratings. The company's sustained business performance in current stretched economic scenario - remains vital for ratings. The control environment needs improvement. This has been incorporated in the rating.

About the Entity
Warble (Pvt.) Limited – one of the pioneer companies of AllahDin Group – is a private limited company. Warble (Pvt.) Limited is equally owned by two brothers. Majority stake is with Mr. Atta ur Rehman 50.8%. Chaudhry Iftikhar Nazir holds 45.2%, rest is held by his wife Mrs. Ghazala Asmat and son. The overall board comprises only three members who are also owners of the company.

The Group Chairman, Ch. Iftikhar Nazir, is the pioneer of AllahDin Group of companies. He has accomplished experience of ~3 decades in the industry. Mr. Zain Iftikhar Chaudhry, son of Ch. Iftikhar Nazir, is COO of the company. He is graduate in Financial Management Services from York University, Toronto.

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.