Press Release

VIS Assigns Initial Entity Ratings to Rizwan Enterprises

Karachi, July 19, 2021: VIS Credit Rating Company Limited has assigned initial entity ratings of ‘A-/A-2’ (A Minus/A-Two) to Rizwan Enterprises (RE). Long Term Rating of ‘A-’ reflects good credit quality with adequate protection factors. Risk factors may vary with possible changes in the economy. Short Term Rating of ‘A-2’ signifies good certainty of timely payment, sound liquidity factors and company fundamentals, and good access to capital markets. Risk factors are small. Outlook on the assigned ratings is ‘Stable’.

Rizwan Enterprises (RE) is a moderate-sized partnership concern engaged in weaving and sizing business with limited presence in stitching segment. The sponsors have extensive experience of more than 40 years in textile business. RE is an export-oriented company with product portfolio including greige fabrics, finished fabrics ROT, bedding, organic bedding, hospitality and healthcare fabrics and pocketing.Manufacturing facility is located in S.I.T.E Karachi.

Assigned ratings captures the limited impact of Covid-19 pandemic on company’s overall performance. Topline, despite the pandemic-induced slowdown, witness a growth trend on account of higher average selling prices while margins have sustained during last two consecutive years. Liquidity profile remains sound while timeline growth in earnings has led to improvement in cash flow coverages. Capital structure is considered conservative with adequate level of leverage indicators. Ratings take into account the company’s ability to achieve revenue growth through expansion along with committed policy to maintain strong capitalization indicators.

Capacity utilization remained under pressure in FY20 due to pandemic related reduction in demand. However, given subsequent economic recovery utilization levels have recovered in the ongoing year on account of sizeable jump in export orders. In view of the same, the management has planned to increase the weaving capacity by ~21%. Since last review, the company has diversified into new regions including France, Greece, Bulgaria and Australia.
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For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 204) or the undersigned (Ext: 101) at (021) 35311861-66 or email at info@vis.com.pk .



Saeed Khan
Executive Director

Applicable Rating Criteria: Industrial Corporates (May 2019)
https://s3-us-west-2.amazonaws.com/backupsqlvis/docs/Corporate-Methodology-201904.pdf

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 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 2021 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .