The Pakistan Credit Rating Agency (PACRA) has maintained the long-term and the short-term entity ratings of JS Investments Limited at ‘A+’ (Single A Plus) and ‘A1’ (A one), respectively. These ratings denote low expectation of credit risk emanating from a strong capacity for timely payment of financial commitments.
The ratings reflect JSIL’s sustained efforts at maintaining its competitive positioning despite continuing tough operating environment. The company’s performance is under pressure on account of decline in AUM resulting in suppressed management fee revenue. However, repayment of fair portion of borrowings and recovery in the market value of investments has helped in reducing the leveraging. The company is still exposed to market risk through investments in its own funds, mainly equity funds. Nevertheless, the strong financial profile of the JS Group remains a source of comfort.
The rating is dependent upon management’s ability to effectively execute its business strategy for growth in AUMs, in turn, improving the company’s profitability. Moreover, JSIL’s ability to augment its risk absorption capacity while managing exposure to market risk would remain critical.
