MIRA INFORM REPORT

Report Date :

01.03.2013

IDENTIFICATION DETAILS

Name :	SHAHEEN AIR INTERNATIONAL LIMITED

Registered Office :	Terminal -1 Road, Jinnah International Airport, Karachi

Country :	Pakistan

Financials (as on) :	30.06.2011

Date of Incorporation :	1991

Com. Reg. No.:	0023516

Legal Form :	Non-Listed Public Limited Company

Line of Business :	Principal activity of the Company is to provide air transport services

No. of Employees :	200 - 300

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	No Complaints
Litigation :	Clear

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – June 30^th, 2012

Country Name

Previous Rating

(31.03.2011)

Current Rating

(30.06.2012)

Pakistan

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

PAKISTAN - ECONOMIC OVERVIEW

Decades of internal political disputes and low levels of foreign investment have led to slow growth and underdevelopment in Pakistan. Agriculture accounts for more than one-fifth of output and two-fifths of employment. Textiles account for most of Pakistan's export earnings, and Pakistan's failure to expand a viable export base for other manufactures has left the country vulnerable to shifts in world demand. Official unemployment is 6%, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Over the past few years, low growth and high inflation, led by a spurt in food prices, have increased the amount of poverty - the UN Human Development Report estimated poverty in 2011 at almost 50% of the population. Inflation has worsened the situation, climbing from 7.7% in 2007 to more than 13% for 2011, before declining to 9.3% at year-end. As a result of political and economic instability, the Pakistani rupee has depreciated more than 40% since 2007. The government agreed to an International Monetary Fund Standby Arrangement in November 2008 in response to a balance of payments crisis. Although the economy has stabilized since the crisis, it has failed to recover. Foreign investment has not returned, due to investor concerns related to governance, energy, security, and a slow-down in the global economy. Remittances from overseas workers, averaging about $1 billion a month since March 2011, remain a bright spot for Pakistan. However, after a small current account surplus in fiscal year 2011 (July 2010/June 2011), Pakistan's current account turned to deficit in the second half of 2011, spurred by higher prices for imported oil and lower prices for exported cotton. Pakistan remains stuck in a low-income, low-growth trap, with growth averaging 2.9% per year from 2008 to 2011. Pakistan must address long standing issues related to government revenues and energy production in order to spur the amount of economic growth that will be necessary to employ its growing population. Other long term challenges include expanding investment in education and healthcare, and reducing dependence on foreign donors.

Source : CIA

Business Name

SHAHEEN AIR INTERNATIONAL LIMITED

Full Address

Registered Address

Terminal -1 Road, Jinnah International Airport, Karachi, Pakistan

Tel #	92 (21) 111-707-070, 99242951 - 57 (7 Lines)
Fax #	92 (21) 99242965

Short Description Of Business

a.	Nature of Business	Principal activity of the Company is to provide air transport services
b.	Year Established	1991
c.	Registration #	0023516

Branch (es)

Mainly in Lahore, Islamabad, Faisalabad, Peshawar & Quetta

Auditors

Haider Shamsi & Co.

(Chartered Accountants)

Legal Status

Subject Company was established as a Non-Listed Public Limited Company in 1991

Authorized Capital	Rs. 1,000,000,000/- divided into 10,000,000 shares of Rs. 100/- each
Issued & Paid up Capital	Rs. 499,990,000/- divided into 4,999,900 shares of Rs. 100/- each

Details of Directors

Names

Designation

Mr. Ehsan Khalid Sehbai

Mr. Khalid M. Sehbai

Air Marshall (Retd) Raashid Kalim

Mr. H P Sidhwa

Mrs. Janet Sehbai

Mr. Kashif Sehbai

Ms. Sabrina Sehbai

Chief Executive

Director

Shareholders

Names

No. of Shares

Mr. Ehsan Khalid Sehbai

Mr. Khalid M. Sehbai

Air Marshall (Retd) Raashid Kalim

Mr. H P Sidhwa

Mrs. Janet Sehbai

Mr. Kashif Sehbai

Ms. Sabrina Sehbai

4,999,872

Associates

A. Subsidiary

None

B. Associated Companies

(1) Shaheen Engineering & Aircraft Maintenance Service, Pakistan.

Products

Principal activity of the Company is to provide air transport services (Domestic & International)

Number of Employees

200 - 300

Annual Sales Volume

Year

In Pak Rupees

2010

2011

7,347,759,000/-

7,730,952,000/-

Trade Suppliers (Foreign)

Subject mainly import from Companies belongs to U.S.A., U.K., & European Countries

Achievements

As a start up airline, SAI commenced its business modestly on 10th December,1993 with a single domestic sector of Karachi-Islamabad-Karachi with two wet leased Boeing 737-200 aircraft. However before long, it caught the eye of the government which accorded it the status of the Second National Carrier on 23rd October,1994. Since then it has not looked back and has growing steadily, while bravely facing the vicissitudes of volatile fuel market with untold resilience. SAI has constantly reviewed its strategic plans and is continuously focusing on improving its service, capacity and creating attractive and advanced business environment for further growth. These include the following:

Current Fleet

AIRBUS FLEET

Shaheen Air International has acquired three (03) A330-300 aircraft and thus has become the only carrier in Pakistan with this state of the art jetliner. The aircraft has a very comfortable two class layout with a seating capacity of 327 passengers. With the induction of A330-300 aircraft, Shaheen Air International has the honor to be the first private sector airline in Pakistan to operate a wide-body aircraft.

BOEING FLEET

Shaheen Air has a fleet of ten self-owned Boeing 737-200 aircraft that are operating on both domestic and international routes. Each aircraft has the seating capacity of 120 passengers and has extra leg space to keep the passengers comfortable throughout their journey.

Shaheen Air International has also finalized a deal for purchase of twelve (12) B737-400 aircraft. This is the largest ever purchase deal by any private sector airline in the history of Pakistan. Boeing 737-400 is a very popular twin engine narrow body short to medium haul jet aircraft. Right now, Shaheen Air International is operating two (02) 737-400s, with seating capacity of 164 passengers, and the number is going to be twelve by the end of year 2012.

Bankers

(1) Habib Bank Limited, Pakistan.

(2) First Women Bank Limited, Pakistan.

(3) Faysal Bank Limited, Pakistan.

(4) Askari Bank Limited, Pakistan.

(5) Bank Alfalah Limited, Pakistan.

Memberships

· Karachi Chamber of Commerce & Industry.

· Islamabad Chamber of Commerce & Industry.

Foreign Exchange Rates

Currency	Unit	Pakistani Rupee
US Dollar	1	Rs. 99.05
UK Pound	1	Rs. 153.50
Euro	1	Rs. 132.70

Comments

Shaheen Air International Limited is a private Pakistani Airline based at Jinnah International Airport Karachi. It has been expanding even after experiencing competition from the other three airline operators in Pakistan. Currently Subject Company enjoys good reputation in Pakistan related to its better services comparing with PIA. Subject Company can be considered for normal business dealings at usual trade terms and conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.53.77
UK Pound	1	Rs.81.57
Euro	1	Rs.70.68

INFORMATION DETAILS

Report Prepared by :

PRL

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

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