Karachi, July 19, 2022 (PPI-OT):VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of DWP Technologies (Pvt.) Limited (DWPTL) at ‘A-/A-2’ (Single A Minus /A- Two). Outlook on the assigned ratings is ‘Stable’. The medium to long-term rating of ‘A-’ denotes good credit quality coupled with adequate protection factors. Moreover, risk factors may vary with possible changes in the economy. The short-term rating of ‘A-2’ denotes good certainty of timely payments. Liquidity factors and company fundamentals are sound. The previous rating action was announced on June 30, 2021.

The ratings factor in DWPTL’s association with DWP Group; its presence in the ever-evolving highly skilled IT solutions and services sector coupled with extensive knowledge and expertise of the management team in the relevant industry. The ratings draw comfort from the company’s long-term business relations with the vendors comprising top-tier multinational information technology companies and customers, including largest telecom companies and banking institutions of Pakistan. Barriers to entry are considered moderate due to demanding technical, financial and operational expertise for pre-qualification bidding.

Topline of the company has depicted growth on a timeline basis, as contracts with banks and telecom companies accounted for a noticeable proportion of revenue during the period July’20-Dec’21. Profitability indicators have also exhibited timeline improvement due to the varying nature of projects, lower finance costs, and one-off other income. In line with higher profitability, cash flow coverages and debt servicing ability of the company have also improved.

This, coupled with effective management of working capital cycle has helped to strengthen liquidity profile. Quantum of debt has increased over the period to finance new projects and to meet associated working capital needs. Consequently, gearing ratio has risen, albeit remains at a manageable level. Ratings remain sensitive to strengthening of capitalization indicators going forward.

For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/