Lahore: Hoora Pharma (Pvt.) Limited, a key player in Pakistan's medical equipment sector, has received its initial entity ratings from The Pakistan Credit Rating Agency Limited (PACRA). The company, founded in 2010, specializes in the supply, installation, and servicing of diagnostic and medical equipment across the country. Its offerings include testing systems for blood, HIV, hepatitis, and imaging equipment like ultrasound, CT scan, and MRI machines.
Hoora Pharma operates under the umbrella of the Hoora Group, which also encompasses Hoora Pharma (AOP) and Pinnacle Biotech (Pvt.) Limited. Pinnacle Biotech focuses on manufacturing and marketing branded generics in therapeutic areas such as cardiovascular, diabetes, and antibiotics. Hoora Pharma has established distribution arrangements with renowned manufacturers, including Siemens Healthineers, GE Healthcare, Shimadzu, and Terumo.
The company employs a hybrid business model, offering direct equipment sales, long-term rental agreements, and service-based contracts to both public and private hospitals, as well as diagnostic laboratories. The demand for diagnostic equipment and services has been on the rise, driven by urban population growth, increased health awareness, and improvements in healthcare infrastructure.
Despite positive growth indicators, the industry faces challenges like exchange rate volatility, regulatory constraints, and significant working capital needs. Hoora Pharma is currently transitioning its business operations from Hoora Pharma (AOP) to Hoora Pharma (Pvt.) Limited, a process expected to conclude by FY26.
In FY24, Hoora Pharma reported a revenue of approximately PKR 3.9 billion, up from PKR 2.1 billion in FY23. The company's gross profit margin slightly declined to around 23.4% due to rising equipment costs. However, its net margin improved to roughly 10%, aided by increased other income. The company's board mainly comprises family members, indicating limited independent oversight, and its external auditors are QCR-rated, suggesting room for enhancing corporate governance.
Hoora Pharma recently became an authorized distributor of Johnson and Johnson's wound closure products, projecting an additional revenue stream. The company's financial risk profile is deemed adequate, with comfortable coverages and cash flows, although its working capital cycle remains stretched.
Going forward, the company's ratings will depend on its ability to maintain revenue growth, improve cost efficiencies, and enhance profit margins. The successful transition of assets, equity, and liabilities from Hoora Pharma (AOP) to Hoora Pharma (Pvt.) Limited will also be crucial.