PACRA assigns Initial Ratings to Ghandhara Industries Limited

Lahore, December 29, 2017 (PPI-OT):Ghandhara Industries Limited (GIL) operates in the truck and buses segment of the automobile sector. The strength of the company is its alliance with ISUZU – a leading Japanese brand in the aforementioned segment. ISUZU has enabled the company to build a strong fortress in the competitive industry of Pakistan. The volumes have been steadily rising – boosting the relative market share of GIL. The company ranks 2nd in the market and has recently announced to launch its pickup range by the name of Isuzu D-Max. The group has built synergies between the two companies operating in the same sector.

The sponsoring group upholds good corporate governance standards. Their business acumen is further enriched by the group’s stake in the country’s leading tyre manufacturing company. GIL has enhanced its market share over the last couple of years. It is important to sustain the growth while managing the rising competition. Foreign players are also taking interest in the local market. The landscape of the industry is expected to change – although it is yet to be seen. The financial risk profile of GIL is strong. The working capital is supported by cash cum advances sale mechanism.

The ratings are dependent on upholding of the company’s business as well as financial risk profile. Two key elements are company’s stance on long term debt and working capital management. Moreover, management’s ability to sustain its market share while benefiting from positive demand fundamentals is crucial.

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