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The Pakistan Credit Rating Agency Limited
Press Release

Date
27-Feb-19

Analyst
Faraan Taimoor
faraan.taimoor@pacra.com
+92-42-35869504
www.pacra.com

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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 IFS Rating of The Universal Insurance Company Limited

Rating Type IFS
Current
(27-Feb-19 )
Previous
(07-Dec-18 )
Action Maintain Maintain
IFS Rating A- A-
Outlook Stable Stable
Rating Watch - -

The rating of Universal reflects strong parentage of the company – Bibojee group. The parentage has provided multi-faceted support to the company: a) injection of capital from different times of the crisis, b) sustenance in the cleansing period spanning over a couple of years, c) captive business. Underwriting resulted in loss while the bottom-line was cushioned from profits of associates. This is also supporting the liquidity of the company. The business strategy envisages tapping captive business with gradual entry into the market business. The road ahead is long, as the company is envisaging new market strategy. Enlistments with some of the leading banks have been completed.
The rating is dependent upon sustained improvement in relative position of the company, augmenting its sustainability, as envisaged by the board and the management. Meanwhile, continued improvement in the financial profile of the company is also imperative for the rating.

About the Entity
Universal Insurance Company Limited, incorporated in 1958, is listed on Pakistan Stock Exchange (PSX). Majority ownership of the company is held by Bibojee Group (87%), through holding company “Bibojee Services Private Limited” (BSL). Bibojee group is a well established in having its presence in various industrial sectors including Textile, Auto, Tyres & Rubber and Engineering.

Eight members BoD constitutes six members from sponsoring family- including the CEO. One member is an employee of the group along with an independent director. The CEO, Mr. Gohar Ayub Khan, replaced in succession to Begum Zeb Gohar Khan (Late), was appointed in January 2016. Managing Director – Mr. Amir Raza, is an experienced insurance professional long associated with the company.

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.