Bazah Tul Qamar
PACRA Maintains Entity Ratings of Pakistan International Bulk Terminal Limited
The ratings draw comfort from sponsors' extensive association with the related business "Marine Group of Companies". The Pakistan International Bulk Terminal Limited (“PIBT” or “The Company”) has secured a distinguished position in its operating segment due to its strategic importance in the Power and Cement sector. With a fully automated infrastructure, the company's annual capacity hovers around 12 million MT for inbound coal handling and 4 million MT of outbound clinker and cement handling. PIBT handled 2.78mln tons of coal cargo in 3MFY21 (FY21: 10.1mln tons, FY20: 8.5mln tons) depicting improved performance with capacity utilization of above 90%. The Company's performance during 3MFY22 & FY21 exhibited decent performance by sustaining revenue, gross profit, and improved cashflows. The Company has reported a bottom-line of ~PKR 1.86bln in FY21 (FY20: 1.1bln), however, on account of the impact of currency devaluation on USD denominated outstanding foreign loans, the Company's bottom line has been impacted. The dollar-based tariff structure provides some comfort towards the foreign obligations. The Company is managing its operational expenses through internal cash generations with no short-term borrowings deployed. The capital structure remains comfortable despite hefty long-term borrowings and is improving due to timely repayments. The result of pending litigation will be crucial for the business. Major demand vests in the domestic cement landscape followed by power producers that are dependent on imported coal for their operations. Since reduced competition in the market because of suspension of coal handling at KPT boded well for the company causing a significant enhancement in its business volumes. However with changing demand dynamics for imported coal as the government's initiatives towards indigenous coal-based power plants, re-instigated competition, hence remain critical for the ratings.
The ratings are dependent upon upholding of strong business profile amidst unforeseen changes in the competitive landscape and, the Company’s ability to improve its margins. Optimal utilization of the capacity and improvement in margins is considered important. Self-sufficiency in meeting debt obligations is the key factor, which may be supplemented by extended support if need be.
Pakistan International Bulk Terminal Limited (PIBT) was incorporated in November 2010, got listed on the Pakistan Stock Exchange in 2013 and commenced its commercial operations on July 3, 2017. The company operates on a "build, operate and transfer" (BOT) model at Port Qasim Authority for the provision of terminal handling services for Coal, Clinker, and Cement for a period of 30 years. Ownership of the company vests with Premier Mercantile Services (Pvt.) Limited (PMS) (~43%), which is the flagship Company of the “Marine Group of Companies” is acting as an Investment arm. Mr. Haleem Ahmed Siddiqui is the Chairman of the Board. He, along with his family, collectively own PMS. Mr. Haleem Siddqui has over ~50 years of experience in marine-related services. He joined Pakistan Merchant Navy in 1959 and commanded various vessels till 1971. He was also the founding Chairman of the Pakistan International Container Terminal (PICT). Mr. Sharique Azim Siddiqui is the CEO of PIBT. He is assisted by a team of qualified professionals.