Press Release

JCR-VIS Reaffirms Entity Rating of Grays Leasing Limited

Karachi, October 2, 2012: JCR-VIS Credit Rating Company Limited has reaffirmed the medium to long term entity rating of Grays Leasing Limited (GLL) at ‘BB-’ (Double B Minus) and short term rating at ‘B’ (Single B).

The company is non-compliant with minimum equity requirement as stipulated by the Securities & Exchange Commission of Pakistan (SECP). Furthermore, the forbearance period granted to the company to enhance its equity has expired and further extension has not been given by SECP. The breach of minimum equity requirement has created significant doubts about the company’s ability to continue leasing business.

On account of challenges confronted by the leasing sector in general and given the risk profile of the company itself, GLL abstained from carrying out any fresh business during FY12. The focus of the management remained on recovery and generation of cash flows from overdue and regular accounts. However, the equity of the company continued to erode on account of losses from operations.

GLL retired a significant part of its outstanding debt in FY12. Moreover, the company has capacity to repay its existing obligations from cash recoveries in the up-coming year. GLL has rationalized operational expenses, which will facilitate in curtailing future losses. However, the company’s ability to carry out new leasing business is uncertain. In view of the above, Outlook on the rating continues to be ‘Negative’.

For further information on this rating announcement, please contact Ms. Sobia Maqbool, CFA at 021-35311861 (Ext. 506) or Mr. Maimoon Rasheed at 042-36610681 or fax to 021-35311873.



Jamal Abbas Zaidi
Deputy CEO

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 2012 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .