The Pakistan Credit Rating Agency (Pacra) has upgraded the long-term entity rating of Jahangir Siddiqui & Company Limited (JSCL) to 'AA+' (Double A Plus) while maintaining the short-term rating at 'A1+' (A One Plus).
The rating of unsecured TFC issue of Rs 500 million has also been upgraded to 'AA+' (Double A Plus).
These ratings denote a very strong capacity for timely payment of financial commitments.
The upgrade is in recognition of the substantial equity injection and retained earnings which have augmented the risk absorption capacity of the company. A rights issue after 2002-03 has resulted in further enhancement of the risk absorption capacity.
This change has thus emerged as the key factor for the rating upgrade as it provides a strong cushion against any unforeseen events.
The rating also recognises the efficacy of the company's business strategy and prudence of risk management policies which are directed at maintaining asset quality while ensuring sustainability of performance.
The company, in line with its strategy of growth and diversification, continues to strengthen its base of subsidiaries and associates.
The subsidiary companies of JSCL include Abamco Limited, JSIBL and Jahangir Siddiqui Capital Markets (Pvt) Limited (JSCM), while BSJS Balanced Fund Limited is an associated company. Starting as a traditional securities firm, Jahangir Siddiqui & Company Limited is now acquiring the character of a holding company.
At the same time, with the diversification strategy regarding asset deployment and consequential impact on the composition of revenue, the company has succeeded in progressively reducing the potential risk.
With its considerably expanded equity and asset base, the company has now embarked on new initiatives while retaining its status as the 'Flagship' company of the Jahangir Siddiqui Group.