Lahore, December 26, 2022 (PPI-OT):The assigned ratings consider EFG Hermes Pakistan Limited’s (‘EFGH’ or the ‘Company’) association with an established international financial services group “EFG Hermes”. Leveraging foreign group expertise and oversight, EFGH provides exceptional research services to its clients. A robust multi-layer control framework is present through independent board representation, board committees, and group oversight. Despite CY22 being a challenging year for local equities, EFGH managed to contain the decline in traded volumes compared to the market and sustained its market share during 9MCY22.
The continued sponsor support in the form of guaranteed loan arrangements of PKR 825mln provides comfort to the ratings. The sponsor reclassified its inter-company balances to enhance EFGH’s equity by ~PKR 118mln. Going forward, the business environment is expected to remain challenging until clarity emerges on the economic front. The rating is dependent on sustainability and improvement in profitability from core income, increasing diversification of the topline, and maintaining market share. Meanwhile, upholding a strong control framework while effectively managing risks remains critical.
For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com