PACRA Maintains Entity Ratings of Awami Agro Commodities
The ratings reflect the strong experienced background of the partners. The partners of the business are well equipped with the related sector knowledge. The strategy of the partnership encompasses maximizing the returns through gaining new markets. Currently, Awami is exporting non-basmati rice mainly to African countries. Awami has established two associated companies in Madagascar and Benin during period under review which will add positively to revenue growth. Turnover of the partnership had shown good growth in past couple of years with consistent generation of healthy margins. As Awami is a partnership, governance structure reflects needs for improvement. Financial risk profile is driven by a bottom line centric approach with a good debt servicing capacity and a leverage capital structure. Debt profile entirely constitutes short term borrowings to manage working capital needs.
The ratings are dependent upon sustenance of margins and revenue growth. Lack of proper board structure is a concern. Sustainable profits, adequate cash flows and working capital cycle are majorly backed by reasonable turnover.
Awami Agro Commodities, established in 2012 by two brothers; Mr. Bhagwan Das and Mr. Sanjesh Kumar, a Partnership, family owned business. Awami Agro Commodities is one of the sustainable companies of rice exports. The business holds membership of Rice Export Association (REAP) and Karachi Chamber of Commerce & Industry (KCCI).
Mr. Bhagwan Das and Mr. Sanjesh Kumar, 50% holding each, are the men behind the name Awami Agro Commodities. Mr. Bhagwan Das has three brothers: Sanjesh Kumar, Naresh Kumar and Govinda Kumar, all associated with Awami Agro. The entire family is in rice industry for past three decades and Mr Vishnu Mal, father of Mr. Bhagwan Das, also owns a company in interior Sindh; Awami Rice Mills.