PACRA Maintains Entity Ratings of Nishat Hotels and Properties Limited

Nishat Hotels & Properties Limited (NHPL or the Company) holds a prominent position within Pakistan’s hospitality and real estate sectors. The Company owns and manages the Nishat Emporium complex, which features a comprehensive shopping mall, a Nishat Hotel (including banquet halls), and, since 2020, ventured into residential development with their 'Nishat Residences' brand, featuring a project comprising 77 luxury apartments. NHPL’s ratings reflect a prominent business profile and a solid brand equity within the hospitality and real estate sectors of Pakistan. The rating derives comfort from NHPL’s strong association with Nishat Group, one of Pakistan’s leading business conglomerates. The Company also benefits from a portfolio of state-of-the-art infrastructure projects. During 2024, Pakistan’s tourism sector exhibited notable growth, both in revenue and international standing. The country’s ranking in the World Economic Forum's Travel & Tourism Development Index (TTDI) improved significantly, moving up 20 places to the 101st position. The growing potential of Pakistan’s hospitality sector has attracted both domestic and international hotel chains, which are actively expanding their portfolios to meet the increasing demand for quality accommodations across luxury, business, and budget segments. This expansion reflects growing confidence in the market’s long-term viability and its capacity to absorb diverse offerings. Aligned with prevailing trends in the hospitality industry, the Company’s key performance indicators (KPIs), including occupancy levels, average daily room rates, and utilization of banquet halls, demonstrated improvements during 9MFY25, leading to a ~16.9% YoY increase in revenue. NHPL's recent acquisition of Nishat Hospitality (Pvt.) Limited is a strategic move, anticipated to strengthen revenue streams within its hospitality segment. Going forward, the Company's plan to acquire other hotel business further underscores its commitment to expansion, which is expected to bolster overall revenue growth. On the Emporium Mall front, the Company successfully attained full occupancy, leasing out all rentable areas, and achieved adequate growth in this segment. Similarly, under the brand of Nishat Residencies, ~67 apartments have been sold, which is considered a significant milestone. The Company benefits from a strong governing board and highly skilled and professional management, providing robust operational support. The financial risk profile of the Company is considered strong, characterized by comfortable coverage metrics, healthy cash flows, and an efficient working capital cycle. Capital structure is low-leveraged, with borrowings predominantly comprising long-term facilities.
The ratings are dependent upon the sustained operational performance amidst an evolving business environment, and a consistent improvement across all revenue segments and margins. Future cash flows generated from the sale of apartments are critical for enhancing debt coverage. Maintaining consistency in the projected performance indicators will remain paramount for the ratings.

About the Entity
Nishat Hotels & Properties Limited (NHPL) is a venture of the Nishat Group, a leading Pakistani business conglomerate with strong credentials across textile, cement, power, dairy, hotel, agriculture, aviation, automotive, etc. NHPL is owned by the Mansha family and associated companies, sponsors of the Nishat Group. The Company's seven-member board includes four sponsoring family representatives and three group executives, led by CEO Mr. Hassan Mansha. NHPL's flagship Emporium Mall spans 15 acres. This comprehensive complex features an eleven-story hotel with ~199 rooms, a shopping mall with 191 shops and 130 kiosks, a food court offering over 30 international and local chains, a 9-screen multiplex cinema, 9 banquet halls, and 7 boardrooms with a combined capacity for over 5,000 people. It also provides ample parking for 2,500-3,000 cars.