Press Release

VIS Upgrades Short-Term Rating of Waves Singer Pakistan Limited

Karachi, November 21, 2019: VIS Credit Rating Company Limited (VIS) has upgraded the short-term entity rating of Waves Singer Pakistan Limited (WSPL) from ‘A-2’ (A-Two) to ‘A-1’ (A-One) while maintaining the medium to long-term rating at ‘A’ (Single A). The medium to long-term rating of ‘A’ denotes good credit quality, with adequate protection factors. Moreover, risk factors may vary with possible changes in the economy. The short-term rating of ‘A-1’ denotes high certainty of timely payment, liquidity factors are excellent and supported by good fundamental protection factors. Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on September 24, 2018.
WSPL, the holding company, is principally engaged in retailing and trading of domestic consumer appliances and other light engineering products, besides the manufacturing and assembling of the same. The ratings take into account consolidated numbers of the wholly owned marketing companies and incorporate that the marketing arrangements, having positive impact on consolidated gross margins, will continue. The assigned ratings take into account strong brand recognition and considerable market penetration of WSPL into the consumer durable industry of Pakistan, particularly in the deep freezer, refrigerator and sewing machine categories. The ratings take into account extensive experience of senior management. Going forward, the company intends to enhance operations by expanding its market penetration across key product categories. The ratings draw comfort from sustained cash flows, adequate debt service coverage and manageable leverage. The ratings are sensitive to increasing trade receivables due to relaxed credit terms, changing consumer preferences for electronics goods, high price sensitivity owing to discretionary nature of spending on durable goods, and vulnerability to foreign exchange risk.
For further information on this rating announcement, please contact the undersigned at 021-35311861-71 or Mr. Maimoon Rasheed at 042-35723411-13.

Jamal Abbas Zaidi
Advisor

Applicable rating criterion: Corporates (May 2019)
https://www.vis.com.pk/kc-meth.aspx

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 November 21, 2019 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.