Press Release
VIS Assigns Preliminary Rating to Proposed Short Term Sukuk-2 of Sadaqat Limited
Karachi, March 16, 2026: VIS Credit Rating Company Limited (VIS) has assigned preliminary rating of ‘A1’ to Sadaqat Limited’s (‘SL’ or ‘the Company’) proposed Short Term Sukuk-2 (STS-2). Short term rating of ‘A1’ reflects strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Rating to be finalized on review of executed documents. The entity ratings of SL stand at ‘A/A2’ (Single A/A Two). Outlook on the assigned medium to long-term rating of SL is ‘Stable.
SL is a vertically integrated textile manufacturer, primarily focuses on exporting premium value-added products like garments and home textiles. The Company’s head office and production facility are located in Faisalabad. Financial assessment shows stable growth in net sales and slightly weaker profitability, however, liquidity profile and debt servicing coverage ratios depicted slight improvement. Moreover, capitalization ratios improved by end-FY25.
SL plans to issue a short-term rated, secured, privately placed STS-2 to eligible investors amounting to Rs. 1,500m (inclusive of a Green Shoe Option of Rs. 1,000m). This Issue will be utilized by SL to finance working capital requirements and will have a tenure of up to six months starting from the issue date. Profit will be payable at maturity of the instrument on the outstanding principal amount. Profit payment will be at a proposed rate of 6M Kibor + 1.35%. Assigned rating reflects the proposed security structure of the instrument with ranking charge over Company’s current assets with 25% margin, lien over export document, lien over DPA established with Askari Bank Limited (AKBL) for the benefit of Issue Agent/Investors. SL shall maintain a dedicated Debt Payment Account (‘DPA’) under lien, to be build up in the following manner - 10% upfront DPA (debt payment account) to be maintained in cash and cash equivalents or financial guarantee from AA rated bank/FI of similar amounts. DPA buildup of 90% in one month before maturity - 30% of payment amount buildup 30 days before maturity, another 30% buildup 20 days before maturity and remaining 30% 10 days before maturity. The Company’s Short-term Sukuk 1 (STS-1) is due for maturity on March 21, 2026. The preliminary rating assigned to the Company’s STS-2 hinges on timely redemption of outstanding STS-1.
For further information on this ratings announcement, please contact at 021-35311861-64 or email at info@vis.com.pk
Applicable Rating Criteria: Corporates:
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale:
https://docs.vis.com.pk/docs/VISRatingScales.pdf
Instrument Rating:
https://docs.vis.com.pk/Methodologies-2025/IRM-Apr-25.pdf