PPI Original Text (PPI-OT) – Pakistan Credit Rating Agency Maintains Ratings of Engro Corporation Limited

Lahore, May 30, 2012 (PPI-OT): The Pakistan Credit Rating Agency (PACRA) has maintained long term and short term entity ratings of Engro Corporation Limited at “AA” (Double A) and “A1+” (A One Plus) respectively. The ratings of secured and listed TFCs issues of PKR 4,000mln and PKR 3,000mln have also been maintained at AA (Double A). These ratings denote a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments.

The ratings reflect ECL’s articulated holding company mandate aimed at creating value in excess of the sum of its parts. The salient features of this mandate include development of a central pool of executive management capable of managing independent businesses, a focused strategy-setting function and succession planning, and strengthening of governance framework.

The ratings take into account ECL’s diversified investment portfolio, which provides space to raise requisite funds besides yielding a stable dividend stream to supplement ECL’s financial profile which is relatively stretched at a group level.

The Corporation’s fertilizer business, the historical mainstay, is facing a major challenge due to shortage of key raw material, yet the pricing power has enabled it to largely offset production losses. All subsidiaries are growing; particularly the food business, while the chemical business has overcome its operational issues.

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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