Press Release
VIS Assigns Initial Entity Ratings to Al-Feroz (Private) Limited
Karachi, July 01, 2025: VIS Credit Rating Company Limited (VIS) assigns initial entity ratings to Al-Feroz (Private) Limited (“AFPL” or “the Project’’ or “the Company”) of 'A+/A1' (Single A Plus/A One). Medium to long term rating of 'A+' indicates good credit quality; Protection factors are adequate. Risk factors may vary with possible changes in the economy. Short term rating of 'A1' indicates a strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. The outlook on the assigned ratings is “Stable”.
AFPL has established itself as a prominent player in Pakistan’s construction and real estate sector, supported by a portfolio of high-value projects, and a strong financial profile. The Company has investments in key real estate developments, including Sky Towers, the Corporate Office Block (both in Dolmen City), and Dolmen Malls (Tariq Road and Hyderi), which collectively generate stable and recurring rental income. Additionally, AFPL’s stake in Dolmen City REIT provides a steady stream of dividend income, providing it a further stream of predictable cashflows.
Over time, AFPL has maintained stable revenues through rental income, accounting for 51.3% of total revenue in FY24, as well as dividend income contributing 47% of revenues. The Company’s profitability is bolstered by its low operational costs and a high efficiency ratio, consistently maintained below 20%. Fair value gains on investments have also contributed to profitability, reflecting the appreciation in asset values. Adjusting for the same, profitability profile remains robust.
AFPL’s financial health is further strengthened by its conservative capital structure, marked by low leverage and the absence of interest-bearing debt. The Company primarily funds its projects through equity, which has grown steadily over time, supported by sustainable cash flow generation.
The Company operates in a high-risk business environment characterized by economic volatility, regulatory changes, significant capital requirements, liquidity constraints, construction delays, environmental compliance obligations, and political instability—all of which pose challenges to profitability and investment returns. Despite these risks, the Company’s portfolio of operational projects provides a degree of stability and mitigates some of these concerns. Looking ahead, the recent acquisition in DHA Dolmen Lahore (DDL) is expected to strengthen the Company’s dividend stream. Furthermore, while new developments and planned diversification into the hospitality sector may contribute positively to long-term growth, they also elevate the overall business risk profile.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Corporate Rating
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
Construction Industry
https://docs.vis.com.pk/Methodologies%202024/CONSTRUCTION-INDUSTRY-RATING-CRITERIA.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf