Press Release

VIS Credit Rating Company Assigns Initial Entity Ratings to ICI Pakistan Limited

Karachi, April 09, 2021: VIS Credit Rating Company Limited has assigned initial entity ratings of ‘AA/A-1+’ (Double A/A-One Plus) to ICI Pakistan Limited (ICI). The medium to long-term rating of ‘AA’ signifies high credit quality; Protection factors are strong. The short-term rating of ‘A-1+’ signifies high certainty of timely payments; short-term liquidity including internal operating factors and/or access to alternative sources of funds is outstanding and safety is just below risk free Government of Pakistan’s short term obligations. Outlook on the assigned rating is ‘Stable’.

Incorporated in 1952, ICI is engaged in the manufacture of polyester staple fibre, POY chips, soda ash, specialty chemicals, sodium bicarbonate and polyurethanes; marketing of seeds, manufacturing and distribution of pharmaceuticals and animal health products; and merchanting of general chemicals and manufacturing of Masterbatches. The company has production facilities located in Karachi, Lahore, Khewra (Jhelum), Sheikhupura, Kasur and Hattar. Ratings assigned to ICI also draw support from strong financial profile and diversified presence of the Company’s sponsor, Yunus Brothers Group (YBG) which is a leading conglomerate having presence across multiple sectors including Cement, Power, Real Estate, Textiles, Chemicals, Pharmaceuticals, Healthcare, Food and Automotive Sectors.

Business risk profile of the company is considered well-diversified with minimal inter-dependence between segments. Ratings incorporate ICI’s market leadership position in the soda ash segment, second largest market share in polyester segment, low business risk profile of the pharmaceuticals segment, and sizeable growth potential in the animal health and chemicals and agri-sciences divisions. While all business segments remain exposed to changes in the macro environment, ratings derive comfort from the diversity across industries and customers supported by historical track record of sustained profitability.

Assessment of financial risk profile incorporates the strong balance sheet position with sound liquidity and capitalization profile. Profitability profile has historically been supported by dividend income from investments; VIS expects this trend to continue going forward. Going forward, management envisages further improvement in profitability profile of the company on the back of projected expansions in value-added business segments. Liquidity profile of the company depicts sufficient cash flows coverages of outstanding obligations. In line with projected increase in profitability, liquidity profile of the company is expected to further strengthen, going forward. Low leverage indicators, conservative financial policy and healthy internal capital generation depicts sound capitalization profile. Given expansion plans in the Soda Ash and Polyester business segments, leverage indicators of the company are expected to increase, however, VIS expects gearing levels to remain below 1(x) over the rating horizon led by consistent improvement in projected profitability profile. Maintenance in financial indicators at current levels is considered important from a ratings perspective.

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

Faryal Ahmad Faheem
Deputy CEO

Applicable Rating Criteria: Industrial Corporates (April 2019)

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 .