The Pakistan Credit Rating Agency Limited
Press Release


Muhammad Harris Ghaffar

Applicable Criteria

Related Research

This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Maintains Entity Ratings of Global Marketing Services

Rating Type Entity
(23-Sep-22 )
(23-Sep-21 )
Action Maintain Upgrade
Long Term BBB BBB
Short Term A2 A2
Outlook Stable Stable
Rating Watch - -

The ratings take comfort from Global Marketing Service’s (GMS or “the Company”) reputable business profile in the clinical and medical lab equipment segment, which serves as a key ingredient in the health diagnostic field. GMS has two primary segments of operations: Clinical and Medical. The clinical division has a significant revenue portion and deals with lab diagnostic and testing equipment kits including PCR Covid-19 kits. Previously in FY21 a year of the COVID-19 pandemic, Sales of GMS were elevated due to a significant hike in PCR testing kits demand. Post-pandemic, the demand for the pharma industry moves towards its stabilization phase. The presence of the Company in medical lab equipment augmented the diversification benefits in their revenue streams. Key strategic pillars of GMS are responsibility and responsiveness towards customers’ needs. Going forward the management has intended to merge the clinical and medical divisions as one unit and planned for the corporatization of the entity but the timeline for execution is uncertain due to DRAP regulations. The management of GMS has developed an internal audit department along with an interim audit review function. The firm is led by Mr. Zafar, the Owner, as assisted by other partners, some of whom are long-standing with the firm. The firm imports all of its inventory, hence exposed to currency fluctuation and associated pricing risks. The overall financial risk profile is characterized by upright working capital management, comfortable cashflows and coverages, adequate capital base and formal and non-formal leveraging. The Company is expected to sustain its position as the pandemic shifted the focus of the general public towards the self-well-being, healthcare and medical engineering segments. Currently, the Company needs to devise its strategy to cope up with economic challenges like hyperinflationary environment, PKR devaluation & overall economic downturn to sustain its financial risk profile.
The ratings are dependent on the firm’s ability to sustain its topline, maintenance of profitability matrix and generation of sufficient cashflows to induce growth. Delivery of the envisaged business and corporatization plan is crucial.

About the Entity
GMS, registered as a partnership concern in 1999, is serving the health industry. The firm have steadily expanded its line of products and created a presence in various diagnostic markets, attaining a respective stature in healthcare and Research/Life Science Solutions. Firm’s focus areas include biomedical investigation, research, life sciences, blood banking, haematology and other medical devices. The firm enjoys exclusive alliances with world leading principals in the In Vitro Diagnostics, Transfusion Medicine, Disposable and other allied segments. GMS has achieved sustained ranking in the top quartile of industry.
Mr. Zafar Mehmood holds majority of the firm's (68%) in the clinical division followed by Muhammad Ayub(20%) & Miss Naheed Dilshad (12%). On the flip side, 58% of the ownership of the medical division is held by Mr. Zafar, while Miss Naheed Dilshad holds (30%) & Mr. Muhammad Ayub has (12%) ownership stake. Corporate head office of the firm is in Islamabad. Corporate, Marketing, Distribution and Storage facilities are located in Rawalpindi.

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.