Press Release

VIS Assigns Initial Entity Ratings to Shirazi Investments (Private) Limited

Karachi, January 11, 2022: VIS Credit Rating Company Limited (VIS) has assigned initial entity ratings of ‘AA/A-1’ (Double A/A-One) to Shirazi Investments (Private) Limited (SIL). The medium to long-term rating of ‘AA’ signifies high credit quality; protection factors are strong. Short-term rating of ‘A-1’ denotes high certainty of timely payment, liquidity factors are excellent and supported by good fundamental protection factors. Outlook on the assigned ratings is ‘Stable’.

Shirazi Investments (Private) Limited (SIL) is the holding company for ‘Atlas Group’ which is one of the top ten business groups in Pakistan and has a long established history of nearly six decades with a cumulative annual turnover of approximately Rs. 300b. The holding company has a diversified business profile with investments in various sectors including manufacturing, power generation, trading and financial services. Shareholding of SIL is vested among members of the Shirazi Family.

The Company’s long-term strategic investment portfolio represents around three-fourth of total asset base, comprising investments in 13 subsidiaries/sub-Subsidiaries and 4 associates. Around 80% of the portfolio is represented by 2 subsidiaries (Atlas Power Limited and Atlas Honda Limited) and 1 associate company (Honda Atlas Cars). SIL is also actively involved in trading of and investments in equity securities and maintains a sizeable proprietary book. Managing of portfolio concentration going forward would be important from the rating perspective.

Assigned ratings incorporate SIL’s strong balance sheet and capitalization levels, sound group level governance structure and healthy income generation capability with two major revenue streams; dividends and rental income. Overall dividend income remained impacted during the period FY19 and FY20 given less or no dividend contribution from some subsidiary/associate investments due to their cyclical nature of business and dividend conservation policy of the sponsors. Nevertheless, in the outgoing fiscal year, dividend inflows registered a strong growth of ~43%. Rental income has also depicted volatility on a timeline basis. Going forward, the management expects healthy growth in earning profile on account of envisaged future business plans in real estate and warehousing segment. The assigned ratings are underpinned by the strong capitalization and earing profile of SIL and its continuation and strengthening going forward.

For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 204) or the undersigned (Ext. 306) at 021-35311861-70 or email at info@vis.com.pk .



Faryal Ahmed Faheem
Deputy CEO

VIS Entity Rating Criteria: Industrial Corporates (August 2021)
https://docs.vis.com.pk/docs/CorporateMethodology202108.pdf

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 2022 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .