Press Release
VIS Reaffirms Entity Ratings of Indus Motor Company Limited
Karachi, December 18, 2025: VIS Credit Rating Company Limited (VIS) reaffirms entity ratings of Indus Motor Company Limited at ‘AA+/A1+’ (Double A plus/A one plus). Medium to long term rating of ‘AA+’ indicates High credit quality; Protection factors are strong. Risk is modest but may vary slightly from time to time because of economic conditions. Short term rating of 'A1+' indicates Strongest likelihood of timely repayment of short-term obligations with outstanding liquidity factors. Outlook on the assigned ratings remain ‘Stable’. Previous rating action was announced on November 15, 2024.
Incorporated in 1989, Indus Motor Company Limited (‘INDU’ or ‘the Company’) is a publicly listed company, which was established as a joint venture between Toyota Motor Corporation (TMC), Toyota Tsuho Corporation (TTC) and House of Habib (HoH). The Company is the sole importer, assembler, manufacturer and distribution of Toyota vehicles in Pakistan. Its head office and production facility are located in Port Qasim, Karachi.
The assigned ratings incorporate strong sponsor profile and brand equity of Indus Motor Company Limited. INDU maintains an established market presence in the passenger cars segment with a sustainable market share. The Company also leverages technological and commercial support from its Japanese sponsors, which reinforces its resilience through economic downturns in local market. The automobile industry remains inherently cyclical, with significant capital intensity, and moderate competitive pressures, with the market still largely concentrated among a few major players. Nonetheless, the competitive landscape has gradually broadened with entry of new assemblers, supported by government incentives. The sector has however, seen a robust growth during FY25, driven by improving macroeconomic stability and declining interest rates. Although this growth is expected to continue into FY26, the sector remains sensitive to regulatory changes and a maturing competitive landscape.
The ratings also incorporate strong financial risk profile of the Company characterized by a conservative capital structure, strong revenue growth in line with improving demand, and enhanced profitability. Meanwhile, liquidity profile remains strong with an adequate current ratio and negative cash conversion cycle. Liquidity is also supported by a sizeable cash balance and substantial short-term investments on balance sheet.
For further information on this ratings announcement, please contact on 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Industrial Corporates
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf