Jahangir Siddiqui & Co. Limited’s (JSCL) Entity Ratings have been maintained by the Pakistan Credit Rating Agency (PACRA).
The rating agency’s primary function is to independently evaluate the capacity and willingness of a company or an entity to honor its obligations.
The reaffirmed status was granted on Thursday, August 16, 2018 with the rating agency maintaining its previous rating of Double A (AA) for the long term, and A One Plus (A1+) for the short term. The same ratings had been previously granted on 29 January 2018.
Elaborating on the rating agency’s decision to maintain these ratings, it said that the ratings reflect JSCL’s strong presence as a Holding Company in the financial sector with a basket of strategic investments.
The most prominent of these investments are JS Bank, Bank Islami Pakistan, EFU Life Assurance and EFU General Insurance.
“While JS Bank is on its path to establish itself in the medium sized banking sector, Bank Islami, lately, achieved pre-provisioning operational break-even. Meanwhile, EFU Life and EFU General continue as a stable income stream for the Company,” said a press release by the rating agency.
It went on to add that JSCL has made significant progress with its diversification strategy in energy, petroleum, and the infrastructure segment while its is also in the process of making investments in LPG storage and an Oil Marketing Company.
“JSCL is envisaging an investment accretion of around PKR 4 billion in the near term,” the rating agency mentioned, adding further that this investment is predominantly being funded by its debt instruments.
“Although the investment activity has increased the debt exposure for the Company, it still remains within moderate limits,” says the rating agency.
“Ratings draw strength from the Company’s moderately leveraged capital structure and continuing growth trajectory in its existing strategic investments. Meanwhile, strict financial discipline in terms of coverage remains critical for ratings.”
Jahangir Siddiqui & Co. Ltd. (JSCL), successor to brokerage business started in early seventies by Mr. Jahangir Siddiqui, was established in 1991 and is listed on the Pakistan Stock Exchange (PSX).
JSCL, JS Group’s flagship holding company, has portfolio of investments categorized into a) subsidiaries, b) available for sale, and c) held for trading. Investments in the financial segment dominate the portfolio, with significant concentration in the banking and insurance sector. New investments of the firm include energy, petroleum and infrastructure sectors.
Jahangir Siddiqui Group owns 72.5% shareholding in the company while Chief Justice (R) Mr. Mahboob Ahmed is currently the Chairman of the Board of Director and Mr. Suleman Lalani is the CEO of the Company.
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