The Pakistan Credit Rating Agency Maintains Ratings Of Modaraba Al-Mali

Lahore: The Pakistan Credit Rating Agency (PACRA) has maintained the long term and short term entity ratings of Modaraba Al-Mali (MAM) at “A-” (Single A minus) and “A2″ (A Two), respectively. These ratings denote a low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong.

The ratings reflect MAM’s equity based capital structure indicating strong risk absorption capacity. The Modaraba’s newly carved out niche – maintenance services business launched under the brand, the Energixers – has received an encouraging response; while adding to its customer base, MAM is registering growth in this segment. The tower lease business, though still lags behind, has lately seen profitability as a result of slight enhancement in capacity utilization. Meanwhile, MAM’s association with one of the leading Islamic banks – BankIslami Pakistan Limited – remains a key rating factor.

The ratings are dependent on the management’s ability to demonstrate sustained improvement in MAM’s revenue streams and hence profitability. Meanwhile, any adverse changes in the socio-economic environment impacting the Modaraba’s business risk profile and/or its risk absorption capacity would have negative implications for the ratings.

About the Modaraba: Modaraba Al-Mali (MAM), incorporated in 1987, is a perpetual multi-purpose Modaraba listed on all three stock exchanges of Pakistan. BankIslami Pakistan Limited owns BankIslami Modaraba Investments Limited, the management company of the Modaraba, which has ~13% equity stake in MAM as at end-Dec11.

BankIslami Pakistan Limited (BIPL), a scheduled Islamic bank and rated ‘A’ (Single A) by PACRA, commenced operations in April 2006 and is listed on the Karachi Stock Exchange.

MAM’s Board of Directors comprises eight members and is dominated by employees of BankIslami, including the President of the bank. The CEO of MAM, Mr. Zulfiqar Ali, an ACMA, possesses over 15 years of experience and has been associated with the Modaraba since long.

For more information, contact:
Hammad Rashid
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com

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