logo
The Pakistan Credit Rating Agency Limited
Press Release

Date
25-Oct-21

Analyst
Kanwal Ejaz
kanwal.ejaz@pacra.com
+92-42-35869504
www.pacra.com

Applicable Criteria

Related Research

Disclaimer
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 Pharmagen Limited

Rating Type Entity
Current
(25-Oct-21)
Previous
(06-Nov-20)
Action Maintain Upgrade
Long Term A- A-
Short Term A2 A2
Outlook Stable Stable
Rating Watch - -

APIs are produced mainly in organic and inorganic synthetic drugs from refined chemicals. This is mostly and predominantly fed through imports. Being the essential element of health care sector, it derives strength from its nature of the business. The importance of local pharmaceutical sector has been strengthen by the supply chain disruption caused by Covid-19 pandemic. Recent depreciation of Pak Rupee against USD will put some pressure on sector’s profitability.The ratings reflect Pharmagen Limited established market position in a specific segment of the pharmaceutical industry; API (Active Pharmaceuticals Ingredients). Pharmagen Limited is a domestic player, claiming leading position amongst the local players which is not a Large universe. Pharmagen Limited has built its profile over the year and serves some top players of the larger industry. The Company has grown and augmented its position and is seen fortifying its production capabilities and product range. The able leadership has spearheaded the company’s strategy and operations. The Company has strong sponsorship with incredible skills and experience in the sector, which is providing a smooth path to company in a directive way. The growth prospects is sanguine. The management is focusing (a) process improvement (b) cost optimization (c) enriching product sweet. The control and governance prospects are continued to improve as a result of new prospects. The management intends to have a reduced appetite of borrowings. The profitability and financial matters will improve gradually.
The ratings are dependent on success roll out of the envisaged strategy. The respective market position needs to be maintained and profitability must be aligned to the improving size. Any dilution in business on financial profile is unwarranted.

About the Entity
Pharmagen Limited is a public limited-unquoted Pharmaceutical company operating in Pakistan since 1990. The company is engaged in the manufacturing and sale of Pharmaceutical products and over the years it has become the leading producer of APIs (Active Pharmaceutical Ingredients) in Pakistan. Pharmagen in majority owned by Pervez Hussain’s family (44%), while other strategic partners include Rasheed Khan’s family (12%), Maj. Gen. (Retd.) Rahim Khan’s family along with Kashmir Education Foundation (17%), and Mr. Shamim Ahmed and his family (27%).

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.