PACRA Maintains Positive Outlook on Ghulam Rasool & Company Amid Financial Growth

Lahore: The Pakistan Credit Rating Agency Limited (PACRA) has affirmed its ratings for Ghulam Rasool & Company (Pvt.) Limited, maintaining both its long-term rating at A- and short-term rating at A2. The outlook has been upgraded from stable to positive, reflecting the company’s robust financial performance and strategic growth initiatives in the construction industry.

According to PACRA, Ghulam Rasool & Company, established in 1970, has sustained its position as a prominent player in the construction sector. The company, known for its work on large infrastructure projects, particularly in irrigation systems and hydropower development, has demonstrated financial resilience despite challenges such as reduced PSDP spending and inflationary pressures. In the fiscal year 2024, the company achieved a topline growth of approximately PKR 12 billion, with improved gross profit margins rising to 20% from the previous year’s 16%.

The company’s strategic focus on asset building through surplus cash, combined with a strong project pipeline and potential new contracts, underpins the positive outlook on its ratings. Management’s optimism about securing these projects is a key factor contributing to this outlook. The company also benefits from limited financial exposure and operates with mild leverage, supported by a mix of banking lines.

Ghulam Rasool & Company’s financial performance is further strengthened by the shareholders’ stakes in multiple companies, enhancing the group’s financial stability. The equity base remains modest at PKR 15 billion in FY24, with the company’s financial risk profile bolstered by consistent growth. Initiatives to improve internal governance and reporting, including the implementation of an ERP system, are expected to positively impact the company’s ratings.

The company’s future growth will rely on the timely completion of existing contracts and successful acquisition of new projects, which are anticipated to provide a sustainable revenue stream. As development activity in the hydropower sector continues to grow, Ghulam Rasool & Company remains well-positioned to capitalize on these opportunities, supported by the extensive experience of its sponsors.

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