PACRA Maintains Entity Ratings of Pakistan Mobile Communications Limited

Lahore, November 08, 2018 (PPI-OT): The ratings incorporate robust business profile of the company, represented by a leading market share of ~37% in the country’s cellular subscribers (~56 million). This strong share has been achieved with organic and inorganic growth. The company enjoys synergies related to operational and technical network, reflected into better earnings for the merged entity.

Optimizing on its single brand “Jazz”, the company commands solid volumes and strong margins. Additionally, in collaboration with Mobilink Microfinance Bank, an associate entity, the company is establishing a strong digital banking platform. Overall market dimensions remain positive, particularly in mobile data services, as penetration level in 3G/4G subscribers stands at ~29%, depicting sufficient room for growth.

Despite the growing trend, over-the-top (OTT) applications continue to be of challenge to the telecom revenues. The company’s financial risk profile exhibits a strong outlook demonstrated by prudent working capital strategies and comfortable coverages. Capital structure reflected a relatively leveraged position and is expected to dilute, going forward, as the company pays off its long term debts, supported by robust and sustainable cashflows.

The ratings are dependent on the sustenance of (i) leading market position (ii) strong profitability and (iii) adequate debt profile. Meanwhile, extending growth in mobile data services is considered important.

For more information, contact:
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com