VIS assigns initial long-term 'BB+' rating to ITANZ Technologies

Mettis Global reported that VIS Credit Rating Company has assigned ITANZ Technologies Limited an initial entity rating of 'BB+/B', with a Stable outlook on both grades. The long-term BB+ grade suggests that commitments are likely to be met, though the support behind this view could weaken if economic conditions shift. The short-term B rating points to some doubt about repaying short-term debt on time, given thin liquidity cushions.

VIS linked the rating to ITANZ's growing presence in Pakistan's IT and IT-enabled services market, backed by a broad mix of offerings spanning services, software development, licensing and BPO. The agency also flagged concentration risk, as ITANZ Infinity generated, on average, 87% of group revenue across the last three years. Of that, only around 10%, or Rs117mn, was collected in cash, while the remainder was netted off through accounting entries tied to the FY26 share purchase. The report says broadening the customer and regional mix remains a priority.

Profit climbed sharply in FY26, but much of the jump came from acquisition-linked accounting items, including a bargain purchase gain and notional interest income. Once adjusted, underlying results were broadly flat against FY25. The acquisition, with its deferred consideration payable over five years, has pushed leverage higher and added to medium-term cash flow strain. Liquidity and cash-flow coverage are still tight after acquisition obligations and FFO adjustments.