OREANDA-NEWS. July 13, 2011. Rating Agency Expert RA Kazakhstan downgrades Kazcat rating to B (satisfactory level of creditworthiness) and ratings of the first issue bonds (NIN - KZ2C0Y05C622) to B (satisfactory level of reliability). Earlier the Company had B+ rating (sufficient level of creditworthiness) and B+ rating of the first issue bonds (sufficient level of reliability), reported the press-centre of KASE.

Also, Expert RA Kazakhstan assigned reliability rating to the second issue of bonds (NIN - KZ2C0Y07D964) at B (satisfactory level of reliability).

Main factors negatively affecting the rating levels for Kazcat, are the high risk of loss of the major part of accounts receivable, as well as the large amount and low diversification of accounts receivable (accounts receivable account for 81% of the company assets as at the end of 2010). Currently, the company is busy with reducing the amount of accounts receivable. Apart from that, there is a high debt burden (interest payments make up 47% of the gross income for 2010). In addition, a restrictive effect was coming from the highly diluted ownership structure (the major shareholder owned 16.32 % of the company as of June 17, 2011).

Currently, besides securities transactions, the company runs a polymetal mining project in Karagandy region, "Implementation of this project will allow Kazcat to diversify its business in future, - says General Director of the Rating Agency Expert RA Kazakhstan Adil Mamazhanov. - However, we estimate that the company is likely to experience difficulties with in attracting funds necessary for development of the mine. In addition, first revenues are as far off as six years from the start".

Amongst factors which positively influenced the company's ratings there are high liquidity ratios (as of December 31, 2010, the absolute liquidity ratio made up 4.03, instant liquidity ratio - 25.8), acceptable business indicators (accounts payable turnover period made up 2 days, that of accounts receivable -  892 days), low level of accounts payable (less than 1% of the Company liabilities, as at the end of 2010), as well as an increase in the Company's equity capital by 293% for the period from 2007 to 2010.

The bonds of Kazcat of the first issue (NIN - KZ2C0Y05C622; issue volume - KZT5 bn, fixed coupon rate of 10% APR, maturing in 2012 году) were included into KASE official list from December 28, 2007. As at the end of 2010, the total face value of  the outstanding bonds made up KZT2.6 bn.

The bonds of Kazcat of the second issue (NIN - KZ2C0Y07D964; issue volume - KZT3 bn, fixed coupon rate of 8% APR maturing seven years after the circulation start) were registered by the authorized government body on March 28, 2011. As of June 29, 2011 these bonds are not circulating.

JSC "Kazcat" focuses on investment operations, and trades insecurities. The Company's revenues in 2010 made up KZT2.9 bn, net profit - KZT620.7 m, assets as at the end of 2010 were estimated at KZT9.1 m, net worth - KZT6.2 bn.