ICRA Nepal assigns LA- and A2+ to long term and short term loans of Quest Pharmaceuticals
Wed, Sep 18, 2019 12:08 PM on Credit Rating, Latest,
ICRA Nepal has assigned the long-term rating of [ICRANP] LA- (pronounced ICRA NP L A minus) to the NPR 318.8-million long-term loans of Quest Pharmaceuticals Private Limited (Quest or the company). ICRA Nepal has also assigned the short-term rating of [ICRANP] A2+ (pronounced ICRA NP A two plus) to Quest’s fund-based short-term limits of NPR 175 million and the non-fund based short-term limits of NPR 143.5 million.
Credit strengths
- Established track record and focused growth strategy
- Good financial profile characterised by healthy profitability and comfortable debt coverage indicators
- Experienced promoters and senior management
Credit challenges
- Fragmented market, low entry barriers and foreign competition
- Stretched liquidity profile
- Supplier risk
- Regulatory risk
About the company
Incorporated in 1999, Quest Pharmaceuticals Private Limited formulates pharmaceutical molecules to produce therapeutic drugs. The company’s first molecule (MYLOD - amlodipine besylate) was launched in the cardiac segment in 2001. Quest produces a wide range of general and specialised medications for cardiovascular, diabetic, dermatological and hypolipidemic ailments among others. It currently produces ~90 different types of drugs in ~25 different categories with a focus on the diabetic and cardiovascular segment, where it remains a market leader among domestic players.
As of mid-July 2019, Quest’s shareholding was divided among 15 individuals. Four of its directors viz. Mr. Umesh Lal Shrestha, Mr. Prithvi Raj Bhandari, Mr. Uttam Kumar Shrestha and Mr. Shailendra Prasad Verma, cumulatively hold a 45% direct stake with the rest being held by the family members and business associates of the directors.
