The Pakistan Credit Rating Agency Limited
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PACRA Upgrades Entity Ratings of Inbox Business Technologies Limited

Rating Type Entity
(23-Nov-22 )
(23-Nov-21 )
Action Upgrade Initial
Long Term A- BBB+
Short Term A2 A2
Outlook Stable Stable
Rating Watch - -

Pakistan’s tech industry contributes ~1% to the national GDP through local and export sales. Export of IT services are estimated to contribute ~$ 1.7bln to the GDP. The largest contributor remains IT consultancy (~33%), followed by software exports (~25%). Lately, the Government and regulatory bodies have taken initiatives such as the establishment of IT Parks and incubators to promote the industry and provide an enabling ecosystem for businesses and start-ups.
The ratings reflect Inbox Business Technologies Ltd.'s ('Inbox' or 'the Company') association with a strong business Group; Dawood Hercules Group. The product slate comprises Enterprise Management Service (EMS), Digital Security and Intelligence (DSI), and Citizen Services and Customer Experience (CSX) in both, public and private sectors. EMS consists of providing customer support, IT outsourcing, warranty, remote assistance, and maintenance services. DSI includes Web Management Services (WMS), which is technical facility deployed on internet gateways in Pakistan, to detect and block illegal international voice calls and manage internet traffic. Whereas, CSX involves the provision of IT related services to the public sector. Inbox has a competitive edge in the industry, as it provides IT solution and services. Lately, the Company's topline experienced significant growth on the back of renewal and addition of local and international contracts. Hence, the Company is generating profits. The Company's financial risk profile is characterized by improving coverages and working capital cycle. Moreover, Inbox's capital structure is supplemented by subordinated loan from sponsors. Conversion of this subordinated loan into equity remains imperative for sustaining the ratings.
The ratings are dependent on the Company's ability to sustain its margins and post healthy coverages while maintaining requisite cushion and working capital discipline. Continued sponsor support remains imperative for ratings. Any further deterioration in cashflows and/or coverages will have a negative impact on ratings.

About the Entity
Inbox Business Technologies Limited (the Company) is a public unlisted company. Primary business activity of the Company involves provision of technology services to the public and private sectors. The Company was incorporated in 2001, by Mr. Ghias Khan (CEO of Engro Corporation Limited) along with his friends, Mr. Mir Nasir and Mr. M. Ali. However, later, it was acquired by Dawood family.
Inbox's majority shareholding resides with Dawood Investments (Pvt.) Ltd. (formerly known as Patek Pvt. Ltd.), a holding investment company held by the Dawood Family. The Company's Board is chaired by Mr. Arif Janjua. Mr. Mohsin Ali heads the Company as its Chief Executive Officer. He is supported by a team of experienced professionals.

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.