ORIX Modaraba : PACRA Maintains Entity Ratings of ORIX Modaraba - Press Release issued by The Pakistan Credit Rating Agency Limited

March 04, 2020 (PPI-OT)

Following is the text of press release issued by The Pakistan Credit Rating Agency Limited (PACRA)

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ORIX Modaraba (ORIXM) enjoys a sound financial profile emanating from leveraging, managed liquidity, and sustained profitability. The ratings reflect the extensive experience of ORIXM management in the financial services industry, stable assets quality, and adequate capital position necessary to manage the current scale of operations. Moreover, strong risk management systems and control environment provide strength to the Modaraba's profile.

The management's business strategy envisages growth in its assets financings, albeit a bit slow due to the ongoing strained economic environment and rising interest rate scenario, to improve its performance trends. The expected growth would be funded through a mix of internal sources and debt. However, the management expects to maintain the leveraging pattern up to a comfortable level. The Modaraba's affiliation with ORIX Leasing Pakistan Limited would assist ORIXM in further strengthening with respect to risk management, providing established outreach and experience, particularly in the SME segment, which the management of ORIXM has identified as a key growth driver.

The ratings are dependent on the ORIXM's ability to develop and sustain its strong business profile while ensuring stable profitability and financial metrics. Deterioration in respective business size and consequent margins, leading to erosion of profitability, and/or coverages will have negative impact on the ratings.

For more information, contact:AnalystThe Pakistan Credit Rating Agency Limited (PACRA)Awami Complex, FB1, Usman Block New Garden Town,Lahore - PakistanTel: [phone]Fax: [phone]Email: [e-mail]: www.pacra.com

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