Press Release

JCR-VIS Assigns Entity Ratings to Fatima Fertilizer Company Limited

Karachi, April 16, 2014: JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has assigned entity ratings of ‘AA-/A-1’ (Double A Minus/A-One) to Fatima Fertilizer Company Limited (Fatima). Outlook on the assigned rating is ‘Stable’.

The ratings take into account the low business and financial risk profile of Fatima. The ratings also incorporate Fatima’s association with renowned and well established business groups of the country.

Local supply of fertilizer products has remained limited vis-à-vis demand in recent years. While international prices have remained higher than the prices of locally produced fertilizers, local prices have remained under check by the government. Fatima has been able to post strong financial results. The management is looking to revamp and de-bottleneck its Ammonia plant that is aimed at enhancing the production capacity; the management expects this to contribute towards further strengthening of the financial position of the company.

Capital structure of the company has witnessed improvement on account of partial retention of profits and simultaneous decline in borrowings. The company has been able to generate adequate cash flows to meet its obligations. With decline in borrowings, the company is projecting further improvement in coverages, going forward. Debt servicing capacity is expected to remain strong under realistic stress test scenarios.

For further information on this rating announcement, please contact Ms. Sobia Maqbool, CFA (Ext: 604) at 021-35311861-71 or Mr. Maimoon Rasheed at 042-36610681-84 or fax to 021-35311872-3.


Jamal Abbas Zaidi
Deputy CEO

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 April 16, 2014 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.