PACRA Maintains Entity Ratings of IGI Holdings Limited

The ratings incorporate the established position of IGI Limited (‘IGI Holdings 'or 'the Company’) as a conglomerate with a diverse pool of investments across leading corporate sectors. IGI Holdings consolidates the financial sector investments of Packages Group, covering both Life and Non-life Insurance, along with Brokerage. The Company's investment portfolio comprises only Strategic Investments including three wholly owned subsidiaries and one subsidiary. The Company maintains diversification in its investment portfolio through a wholly owned subsidiary IGI Investments (Pvt.) Ltd which functions as an investment holding Company. Moreover, providing competitive advantages and contributing to long-term growth and financial stability. The Company has a well-established mechanism for supervising the investment management and monitoring processes, as well as for making new investments, which is a crucial requirement for any holding company. Investment decisions are mainly led by Mr. Waqas Munir, Group's Chief Investments Officer, with assistance from resources within Packages Group’s. IGI Holdings has designed a prudent investment policy in accordance with investing assets in a way that's suitable for the investor's goals and objectives. The Holding Company’s long-term investment portfolio remains stable as of 9MCY24. However, IGI investment showed a ~14% growth in its long-term investment. IGI Holdings derives its revenue mainly from dividend income through its investments in long term. Dividend income escalated by ~6% during 9MCY24. This growth represents a positive shift in the financial health of dividend-paying companies and broader market trends, reflecting a combination of factors that have contributed to stronger income distributions to shareholders. Other income on the other hand also adds a liquidity cushion to the Company. The businesses under IGI Holding's umbrella have maintained a steady growth trajectory, demonstrating the strength of the Group's strategic approach. The Company's substantial free cash flows have significantly improved its debt profile, resulting in a marked enhancement of its interest coverage matrix. The Company has strengthened its capital structure by decreasing short-term debt and optimizing working capital through better cash flow management. Herein, the institutionalization of investment policies would be beneficial. The evolution of investment policy extending into short term investment portfolio will supplement cash liquidity. Continued sponsor support remains a key rating factor.
Ratings depends upon the existing and new strategic investments along with investment and governance framework. Establishing a robust and efficient system to monitor performance and offer comprehensive guidance to its subsidiaries, coupled with diversifying investments, would positively impact the rating of IGI Holdings Limited.

About the Entity
IGI Holdings Limited, incorporated as a public limited company in 1953, is an Investment Holding Company for financial services business of Packages Group. The Company completed its corporate structuring during 2017 involving amalgamation of IGI Investment Bank into IGI Insurance Limited and demerger of Insurance segment and Investment segment resulting in wholly owned subsidiaries i.e. IGI General Insurance Limited, IGI Finex and IGI Investments (Pvt.) Limited. Major ownership of IGI Holdings (~72.75%) vests with Packages Group through sponsors (~32.4%) and associated entities (~40.20%). The remaining stake of ~4.36% is held by Financial Institutions, Banks, Insurance Companies, Modarabas & Mutual Funds and the rest ~29% is free floated. Syed Babar Ali serves as the Chairman of the Board while Syed Hyder Ali is the CEO of the Company.