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The Pakistan Credit Rating Agency Limited

Date
29-Dec-2017
Analysts
Jhangeer Hanif
jhangeer@pacra.com

Iqra Bashir
iqra.bashir@pacra.com

+92-42-35869504
www.pacra.com
Applicable Criteria

  • Corporate Rating Methodology (Jul 17) [View]

Related Research

  • Sector Study | Household Appliances (Dec 16) [View]
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PACRA assigns Initial Entity Ratings to Airlink Communication
 Rating Type Entity
Current
(29-Dec-2017)
 Action Initial
 Long Term BBB+
 Short Term A2
 Outlook Stable
 Rating Watch -

The ratings denote Air Link’s adequate operational sustainability underpinned by its solid market position, balanced earnings contributions from its mobile business, as well as its strong financial profile. Association with strong brands, Huawei & Samsung, enables Air Link to propel the growth wheel forward.

Over the last few years, the Company has improved its business profile. During FY17, the company’s topline witnessed ample growth mainly because of increase in Samsung retail business and exports. FCFO of the company witnessed decent improvement owing to higher EBITDA. Air Link has lately been converted into a private limited company with only a two member board. The company’s import driven business model is secured mostly because of 100% cash margin. The company's financial risk profile is adequately covered. Ratings incorporate that Air Link operates in a fast moving market where timely introduction and sale of products is crucial.

The ratings are dependent on the company’s ability to strengthen its market position, gain in terms of EBITDA and profitability margins. Any deterioration to margins and/or cash flows remains critical to the ratings. Upholding strong governance is essential.
About the Entity
Air Link incorporated in 2012, is a private limited company. The Company is principally involved in distributing mobile phones of two leading brands in industry; Huawei and Samsung. The Company is owned by sponsoring family. Mr. Shaukat Hayat Piracha is Chairman and Mr. Muzaffar Hayat Piracha is the CEO of the company. Mr. Muzaffar Hayat and Mrs. Saliha Basit are board members. Mr. Nusrat Mehmood, the CFO, looks after the finance function at group level. Mr. Asim Mehmood, the head of planning and sales, is involved in the company’s all key business decisions.
The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.
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