Press Release

VIS Reaffirms Ratings of Shifa International Hospitals Limited

Karachi, November 18, 2021: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Shifa International Hospitals Limited (Shifa) at ‘AA-/A-1’ (Double A Minus /A-One). The medium to long-term rating of ‘AA-’ denotes high credit quality coupled with strong protection factors. Moreover, risk factors may vary slightly with possible changes in the economy. The short-term rating of ‘A-1’ denotes high certainty of timely payment, liquidity factors are excellent and supported by good fundamental protection factors. Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on November 24, 2020.

The assigned ratings take into consideration the clinical reputation of Shifa as a large private healthcare organization within northern region of the country and ample experience of senior management team. The ratings draw comfort from Shifa’s unique positioning, vis-à-vis other large hospitals, as an integrated health system providing primary, secondary, tertiary and quaternary healthcare services with the hospital specializing in high acuity cases. The ratings also factor in broad services array and scale of operations, as well as significant expansion plans over the next four years, involving establishment of large-scale hospitals in Faisalabad and Islamabad.

Business risk profile is considered to be medium to low given limited demand cyclicality in healthcare services sector and growing demographic trends of Pakistan. However, deficit of human capital in the industry is considered a business risk factor. Underpinned by growing demand for healthcare services, the company has generated sustainable revenue growth on a timeline basis. Growth momentum in operating revenue improved in FY21 due to resumption in OPD services along with launch of E-Shifa encompassing in-home treatment of patients through teleconsultation. Given improvement in the same, profitability and cash flow coverages of outstanding obligations showcased improvement in FY21 and the ongoing year. The ratings also incorporate adequate debt coverage, sound cash position, and manageable leverage despite increasing debt levels. With gradual repayments, leverage indicators of the company are projected to further strengthen. Ratings remain dependent on maintaining sound financial profile going forward given consistent planned investments in subsidiaries to set up two more hospitals in the country.

For further information on this rating announcement, please contact Ms. Asfia Aziz or the undersigned (Ext: 306) at 021-35311861-70 (Ext. 201) or email at

Faryal Faheem Ahmed
Deputy CEO

VIS Entity Rating Criteria: Corporates (August 2021)

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS , the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2021 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .

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