Press Release

VIS Maintains Entity Ratings of The Imperial Electric Company (Pvt.) Limited.

Karachi, January 31, 2024: VIS Credit Rating Company Limited (VIS) maintains entity ratings of The Imperial Electric Company Private Limited (“IEC’’ or “the Company’’) to 'A-/A-2' (‘Single A Minus/Single A-Two’). 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 'A-2' indicates good certainty of timely payment. Liquidity factors and company fundamentals are sound. Access to capital markets is good. Risk factors are small. Outlook on the assigned ratings has been changed to ‘Positive’ from ‘Stable’. Previous rating action was announced on February 06, 2023.
The Imperial Electric Company (Pvt.) Limited is situated in Lahore and specializes in producing and installing diesel generators, along with offering after-sale services. IEC is also involved in providing low-voltage electrical components, lighting products, and airfield lighting systems for the aviation industry. The Company has significant industry presence due to its comprehensive electrical solutions to renowned telecom service providers and other private institutions.
Assigned ratings incorporates the business risk profile of the Company, characterized by its strong market presence in the electrical equipment manufacturing industry of Pakistan. Competition within the local industry and with imported Chinese products is at moderate level. Moreover, IEC's recent expansion into the solar segment further enhances its competitive profile. However, additional external risks like import restrictions in the country are considered key constraints in the business.
Change in outlook incorporates the Company’s financial risk profile wherein given challenges the Company’s liquidity and coverage profiles remained sound and in line with assigned ratings. IEC’s topline growth, affected on account of LC constraints in FY23, is supported by its long-term contracts with large telecom service companies and its expansion into the solar business. Despite normalization of gross profitability in 1HFY24 with eased import restrictions and improved operations, net margins remained constrained by heightened finance costs. Additionally, the conservative capitalization profile of the Company, while exhibiting a slight deterioration, remain commensurate with assigned ratings. Moreover,
Going forward ratings will remain sensitive to the Company's ability to show further improvements to its profitability, capitalization, liquidity and coverage profiles in future reviews.
For further information on this ratings announcement, please contact Mr. Saeb Muhammad Jafri (Ext: 202) or the undersigned (Ext: 201) at 021-35311861-64 or email at

Sara Ahmed

Applicable Rating Criteria:
Industrial Corporates
VIS Issue/Issuer Rating Scale

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