Press Release

JCR-VIS Assigns Entity Ratings to Master Motor Corporation (Private) Limited

Karachi, April 6, 2018: JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has assigned entity ratings of ‘A-/A-2’ (Single A Minus/A-Two) to Master Motor Corporation (Private) Limited (MMCL). Outlook on the assigned rating is ‘Stable’.

The assigned ratings to MMCL incorporates company’s position as a prominent player in the assembling of leading Chinese and Japanese automobile manufacturers, sound business risk profile underpinned by growing demand for heavy vehicles, protective duty structure and raw material & exchange rate fluctuation pass through mechanism in place with clients. Ratings could be constrained by adverse changes in operating environment and duty structure on raw products. Current ratings of the company take into account sound financial profile and low leverage indicators. The ratings also incorporate MMCL’s association with a renowned and well established business group of the country.

MMCL belongs to the automotive industry with luxury buses as its flagship product. The company also produces trucks and prime movers. Customer profile of the industry varies from oil and gas, logistics, power, medicine, pharmaceuticals, food etc. Revenue base of the company has grown on a timeline basis largely on the back of higher volumes. In order to improve its top line, MMCL also plans to expand its product line into medium sized Foton trucks & prime movers for which it has invested in production facilities.

Debt profile of MMCL comprises short-term debt only, acquired on a need basis for working capital financing. Leverage indicators remained within manageable limits. At current debt levels, debt servicing coverage remains comfortable with the company projecting further improvement in the same. Moreover, management envisages meeting its future funding requirements through internal capital generation and director’s loans.

For further information on this rating announcement, please contact Mr. Javed Callea (Ext: 201) or the undersigned (Ext: 207) at 021-35311861-71 or fax to 021-35311872-3.

Javed Callea

Applicable Rating Criteria: Industrial Corporates (May 2016)

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited VIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2018 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited