Press Release
JCR-VIS Assigns Initial Ratings to Khalid Shafique Spinning Mills Limited
Karachi, February 18, 2019: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned initial entity ratings of ‘BBB/A-2’ (Triple B/A-Two) to Khalid Shafique Spinning Mills Limited (KSSML). The medium to long-term rating of ‘BBB’ denotes adequate credit quality coupled with reasonable and sufficient protection factors. Moreover, risk factors are considered variable 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 and risk factors considered small. Outlook on the assigned ratings is ‘Stable’.
KSSML is a small-sized spinning unit involved in manufacturing of yarn with majority shareholding vested with the sponsoring family. The ratings assigned to KSSML take into account sound coverages amid adequate liquidity and low leverage indicators. With procurement of cotton and sale of yarn mainly emanating from local market, the company’s vulnerability to fluctuations in forex rates is low. The ratings are largely constrained by KSSML’s spinning unit running close to full capacity, modest turnover, small equity base and the vulnerability of the spinning sector to raw material prices.
For further information on this rating announcement, please contact the undersigned at 021-35311861-70 or Mr. Maimoon Rasheed at 042-35723411-13.
Javed Callea
Advisor
Applicable rating criterion: Industrial Corporate (May, 2016)
http://jcrvis.com.pk/docs/Corporate-Methodology-201605.pdf