The Pakistan Credit Rating Agency Limited
Press Release


Sohail Ahmed Qureshi

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PACRA Maintains Entity Ratings of Nishat Hotels and Properties Limited

Rating Type Entity
(24-Jun-22 )
(25-Jun-21 )
Action Maintain Maintain
Long Term A- A-
Short Term A2 A2
Outlook Stable Stable
Rating Watch - Yes

Nishat Hotels & Properties Limited (‘NHPL’ or 'the Company') ratings reflect a prominent business profile in the hospitality and real estate segments. The Company has set up a project comprising a state-of-the-art shopping mall (Nishat Emporium), a luxury hotel, banquet halls, and residential apartments (FCC Apartments). The ratings take comfort from the company’s association with Nishat Group, one of the leading business conglomerates in Pakistan. The hotels and tourism industry has comprehended recovery after facing the severe effects of the Covid-19 pandemic. The Company was able to achieve operational sustainability in these challenging times. Currently, the hotel occupancy rates and average daily room rates have shown considerable improvements which translated into better financial performance. Commercial and business activities in Emporium Mall have also shown a rising trend and achieved splendid footfall during the period under review. In the real estate business segment, sales of Nishat FCC apartments are gradually striding. The Company has benefited from a strong governing board, and operations take comfort from skilled and professional management. The financial risk profile of the Company is considered adequate with comfortable coverages, cash flows, and working capital cycle. Capital structure is leveraged where borrowings are mainly comprised of long-term borrowings.
The ratings are dependent upon the sustainability of operations, and improvement in revenues and margins. The sponsor’s support and future cash flows from the sale of apartments are vital. At the same time management of financial risk, particularly debt coverages, remain important, wherein any deterioration would have negative implications for the ratings.

About the Entity
Nishat Hotels & Properties Limited is a venture of Nishat Group - the country's leading business group having strong credentials in managing ventures in the textile, cement, energy, hospitality, and financial sectors etc. The Company is owned by sponsors of Nishat Group; the Mansha family and associated companies. The Company’s seven-member board of directors comprises four representatives of the sponsoring family along with three executives from group companies. Mr. Hassan Mansha, the CEO, is the leading person, engaged in multiple ventures of the group.
Emporium mall sprawls across an area of 15 acres and comprises an eleven-story hotel with ~198 hotel rooms, a shopping mall consisting of 195 shops and 99 Kiosks, a food court catering to over 30 international and local chains, a multiplex cinema of 9 screens, 7 banquet halls with a combined capacity of over 5,000 people and a parking space of 2,500-3000 cars.

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.