Press Release

JCR-VIS assigns initial entity rating of BBB/A-3 with a Positive Outlook to Matco Rice Processing (Pvt.) Limited

Karachi, April 5, 2010: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned an initial entity rating of ‘BBB/A-3’ (Triple B / A-Three) to Matco Rice Processing (Pvt.) Limited (Matco).

Matco is one of the leading players in the Basmati rice export market. After crossing the $2 billion export mark, rice has become the second largest export commodity of Pakistan after textile. Pakistan is one of the major producers of rice and on account of low per capita domestic consumption more than 50% of the total production is exported. Major export markets include Middle East and Iran. In Basmati rice export, Pakistan faces competition primarily from India, which is the only other producer of the variety. However, on account of higher export prices and local consumption in India, Pakistan has surpassed India in rice exports. The industry has experienced volatility with prices peaking in FY09 and dipping in the ongoing financial year leading to fall in margins. The downward trend in prices has abated in recent months and has also been offset to an extent by fall in raw material prices and the impact of rupee depreciation.

Given currently low price levels, the management has taken steps to improve profitability through continued focus on brand development; increasing volumes through active marketing/capacity enhancement and lowering cost of production through ongoing capital expenditure for backward integration. In view of these measures Outlook on the assigned rating is ‘Positive’. Institution of corporate governance principles on a voluntary basis; improvement in capitalization levels and achievement of target performance levels may further improve the risk profile of the company going forward.

For further information on this rating announcement, please contact the undersigned (Ext: 501) or Mr. Safdar Kazi (Ext: 604) at 021-35311861-70 or fax to 021-35311873.

Javed Callea

Information herein was obtained from sources believed to be accurate and reliable; however, JCR-VIS Credit Rating Company Limited (JCR-VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. JCR-VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. JCR-VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings. JCR-VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2010 JCR-VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to JCR-VIS.

JCR-VIS Credit Rating Company Limited