The Pakistan Credit Rating Agency Limited
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PACRA Maintains Entity Ratings of Orient Rental Modaraba

Rating Type Entity
(27-Oct-23 )
(31-Oct-22 )
Action Maintain Maintain
Long Term A- A-
Short Term A2 A2
Outlook Stable Stable
Rating Watch - -

Orient Rental Modaraba ('the Modaraba') enjoys association with Orient Energy Systems (Pvt.) Ltd. through Eman Management (Pvt.) Ltd. - the Modaraba management company - reaping benefits of complementary business. The Modaraba is multi-purpose and perpetual. The Modaraba mainly generates revenue from Ijarah Rentals (Genset - operating on diesel and gas), mainly emanating from the textile and real estate sectors, followed by support from Operations & Maintenance (O&M) agreements, mainly trickling from the tobacco sector. The Modaraba also provides facility services. Topline and in turn profits posts stability; however, remains lean. Despite low in quantum, high gas prices impact gas genset deployment. However, diesel based gensets are fully deployed. Going forward, the management plans to enhance the customer base of the O&M segment and facility services to support the Modaraba's performance. Financial risk of the Modaraba remains adequate supported by manageable leveraging with minimal reliance on Diminishing Musharakah facility. Sustained capacity utilization and strengthening the governance framework remains crucial for ratings.
The ratings are dependent on the relative positioning of the Modaraba in the sector and sustained asset quality: sustaining bottom-line profitability is important. The ratings also depend upon keeping its financial profile intact. Any significant change in its risk profile may adversely impact the ratings.

About the Entity
Orient Rental Modaraba ('the Modaraba') is a multi-purpose perpetual Modaraba and became operational on 24-Nov-17. The Modaraba mainly operates in two segments: Ijarah Rentals (provide equipment rental solutions) along with Operations & Maintenance agreements. The Head Office is located in Karachi, while also maintaining a sub-office in Lahore. The Board is chaired by Mr. Chaudhry Jawaid Iqbal; while, Mr. Teizoon Kisat serves as the Chief Executive Officer (CEO). He is assisted by a team of 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.