Press Release

VIS Maintains Ratings of Kamal Limited with ‘Rating Watch - Developing’ Status

Karachi, April 23, 2020: VIS Credit Rating Company Limited (VIS), while maintaining the entity ratings of ‘A-/A2’ (Single A Minus/A-Two) assigned to Kamal Limited (KL), has placed the same on ‘Rating Watch-Developing’ status. The long term rating of ‘A-’ signifies good credit quality; protection factors are adequate. Risk factors may vary with possible changes in the economy. The short-term rating of ‘A-2’ denotes good certainty of timely payments. Liquidity factors and company fundamentals are considered sound. The previous rating action was announced on February 27, 2020.

KL is a composite textile unit engaged in spinning, weaving, dyeing, bleaching, printing, stitching and manufacturing of garments and home textile along with the retailing. The company also has its footprint in the local market through a brand called “SO Kamal” for the sales of ready-to-wear clothes, fabric & bed linen. Exports on average account for five-sixth of over revenue mix.

The revision in rating outlook reflects prevailing uncertainty in textile sector dynamics due to coronavirus outbreak, prolonged lockdown, overall contraction in demand and challenging economic environment. It is expected that the entire value chain of the textile industry will be effected by these developments. Status of the assigned rating is therefore uncertain as an event of deviation from expected trend has occurred; additional information will be necessary to take any further rating action, warranting a ‘Rating Watch-Developing’ status. Given that company has largely stable financial risk profile, it is expected that ratings will remain stable post-recovery of the ongoing situation; nevertheless as scenario is evolving rapidly, VIS will closely monitor and will accordingly take action to resolve the outlook status.

For further information on this rating announcement, please contact Syed Fahim Haider at 042-35723411-13 (Ext: 8006) or the undersigned at 021-35311861-70 (201) or mailto:info@vis.com.pk




Faryal Ahmad Faheem
Deputy CEO

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 April 23, 2020 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.