Press Release

JCR-VIS Upgrades Entity Ratings of International Complex Projects Limited

Karachi, October 19, 2018: JCR-VIS Credit Rating Company Limited (JCR-VIS) has upgraded the entity ratings of International Complex Projects Limited (ICPL) to ‘AA/A-1’ (Double A / A-One) from ‘AA-/A-1’ (Double A-Minus/ A-One). The long term rating signifies high credit quality with strong protection factors. Risk is considered modest but may vary slightly from time to time because of economic conditions. Short term rating of ‘A-1’ depicts high certainty of timely payment where liquidity factors are excellent and supported by good fundamental protection factors. Outlook on the assigned rating is revised from ‘Stable’ to ‘Positive’. Previous rating action was announced on March 5, 2018.

Assigned ratings of ICPL take into account strong sponsor profile of ICPL, ‘The Dolmen Group’, a real estate developer operating in Pakistan. The group is renowned for its commercial and retail developed projects including the Dolmen City Project. Change in ratings also factor in sound capitalization levels, low leverage indicators and healthy dividend stream from Dolmen City REIT (DCR). There is currently no debt on the books and the company plans to internally fund the completion of its ongoing projects; ratings may be impacted, in case additional debt is mobilized by ICPL in the future.

The company has a diversified revenue stream with cash flows emanating in the form of dividends from DCR, rental income from its corporate block and sale proceeds of office space from one of its under construction projects. Current projects of ICPL include a shopping mall and a corporate building which are placed in the DCR (REIT) scheme. Two executive towers, ‘Sky tower’ and ‘Hotel tower’ are also expected to achieve completion by end-December 2019. Each tower has a total of 35 floors each; to date, 7.25 floors of ‘Sky tower’ have been sold while sale of another 5 floors are under discussion. Current ratings will remain dependent on materialization of these negotiations. Going forward, management targets to sell at least one floor of ‘Sky tower’ in each quarter. Moreover, for its ‘Hotel tower’, the company has signed an agreement with Rotana Hotels & Resorts (RHR). As per the profit sharing agreement, top 10 floors of the tower will be handed over to RHR while property management will remain under the ambit of ICPL. Cash flows from this arrangement are expected to emanate from 2020. Overall corporate governance framework depicts room for improvement.

For further information on this rating announcement, please contact Ms. Muniba Khan (Ext: 214) or the undersigned (Ext: 207) at 021-35311861-71 or fax to 021-35311872-3.

Jamal Abbas Zaidi

Applicable Rating Criteria: Industrial Corporates (May 2016)

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited 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.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.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.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 2018 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited