Final PR
The Pakistan Credit Rating Agency Limited

Jhangeer Hanif

Saliha Sajid

Applicable Criteria

  • Corporate Rating Methodology (Jul 17) [View]
  • Correlation between long-term and short-term rating scale (Jun 17) [View]

Related Research

  • Sector Study | Food and Allied (Dec 17) [View]
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PACRA assigns Initial Entity Ratings to Sayban International
 Rating Type Entity
 Action Initial
 Long Term BB+
 Short Term A3
 Outlook Stable
 Rating Watch -

Sayban operates in three segments: i) pesticides ii) seeds and bio fertilizer. Sayban is a leading player in the first segment. Sayban has also led the introduction of bio fertilizer in Pakistan. The Company has a sizeable turnover, with contribution of each segment, though pesticides is predominant in terms of revenue. Profitability of the company is sanguine. Sayban maintained its market presence with controlled cost, good EBITDA margins and improved profitability. The company is now making efforts for joint venture with Chinese investor which will help company to improve its market share amidst the large fragmented industry. Sayban is still a partnership yet in short period it will be converted into a private limited company. The governing structure is expected to improve as Sayban moves towards corporate structure. Company meets working capital requirements through a mix of internal cashflows and STBs. However, the financial risk remains good on account of low leveraged capital structure and adequate coverages. Going forward, the sustenance in bottom-line and cash flows, formalizing the governance and financial transparency is vital.

The ratings are dependent on sustained business and financial profile of the company. Any deterioration to margins and/or cash flows remains critical to the ratings.
About the Entity
Sayban International (Under Sayban Group) incorporated in 2005 as a result of AOP, started its operations in 2007. Sayban has been working independently from 2015 with same shareholding. According to the current shareholding Mr. Muhammad Azam Cheema and Mr. Jamshed Cheema each holding 24.1% shareholding. Major shareholding will move to Mr. Muhammad Azam Cheema and Mr. Shamsher Hussain each 44.18%. Sayban Zarai Markaz (Pvt.) Limited has been formed to acquire the Sayban International after restructuring the ownership.

Sayban, as a partnership, does not have a formal BOD structure. The Company is being run by Partners; they have their repetitive roles in the management of the Company. Going forward, 3 partners (existing 7) will be engaged in the management. Mr. Muhammad Azam Cheema is the CEO of the Company. He possesses vast business acumen spanning over two and half decades – is also at board of Al-Haram Paper & Board Mills (Pvt.) Ltd and Apna Microfinance Bank Limited. The CEO is supported experienced management team; a balanced blend of professional people from the industry.
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.