PACRA Assigns Initial Entity Ratings to Jamal Pipes Industries (Private) Limited : AsiaNet-Pakistan

PACRA Assigns Initial Entity Ratings to Jamal Pipes Industries (Private) Limited

July 18, 2019 | General Business News | Share:

Lahore, July 18, 2019 (PPI-OT): Jamal Pipes Industries (Pvt.) Limited, a family operated business, is engaged in manufacturing of pipes and allied products since four decades. The Company’s product slate includes black line pipes, galvanized line pipes, variety of poles (octaconical poles, tubular poles and street light poles) and Guardrails. The diversification in product slate is considered positive while further strengthening of revenue from all products would reduce concentration and add cushion to business risk profile. The company has been catering to the demand of corporate projects since last many years and enjoys association with corporate clients.

The ratings reflect an adequate market presence of the company in a highly fragmented industry. Over the last few years, the company’s business risk profile has strengthened on account of better volumetric sales. The recent economic downturn is a challenge. Recently, the Company has performed BMR which will lead to cost efficiency in upcoming years. The Company operates on adequate but improving business margins.

The financial risk revolves around higher short-term borrowings to support the working capital – inherent need of the business model followed by the company. The Company has an explicit policy of not raising any long term debt. Going forward, the Company’s debt levels are expected to remain range-bound. The ratings incorporate four decades long association of sponsor family with the same industry. The ratings are dependent upon the company’s ability to sustain its business profile in the wake of challenges in current diluted economic scenario. Herein, effective and prudent management of financial risk indicators remain important.

For more information, contact:
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com

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Category: General Business News