Press Release
VIS Assigns Preliminary Rating to Proposed Short Term Sukuk-3 of Sadaqat Limited
Karachi, September 9, 2026: VIS Credit Rating Company Limited (VIS) has assigned preliminary rating of ‘A1 (plim)’ to Sadaqat Limited’s (‘SL’ or ‘the Company’) proposed Short Term Sukuk-3. Short term rating of ‘A1 (plim)’ 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. The rating of the proposed instrument considers the underlying security structure and the entity’s credit profile. The assigned rating also reflects the Company’s established position in the vertically integrated textile sector, experienced management team, strong export franchise, and long-standing relationships with leading international retailers.
SL plans to raise a secured, privately placed debt instrument, Short-term Sukuk 3 (STS-3), amounting to Rs. 2,000m (inclusive of Rs. 750m green shoe option). The tenure will be six months, and the funds will be utilized to fulfilling the Company's working capital requirements related to funding export orders. The profit rate is yet to be finalized. Profit will be payable at the time of redemption of respective instrument on the outstanding principal amount. The principal will be redeemed as bullet payment six months after the Issue Date. The instrument is secured by way of ranking charge over Company's current assets with 25% margin, lien on cash equivalent security covering up to 5% of the issue amount, lien over export document and 5% upfront DPA (debt payment account) from the proceeds of disbursement, DPA for 95% in last month on an equal weekly basis and to be fully funded 10 days before maturity.
The Company’s predominantly export-oriented business model, with exports contributing 94.4% of sales, together with increasing traction in the US market, provides a degree of geographic diversification. Despite a challenging operating environment and shipment disruptions arising from the Middle East situation, revenues remained resilient, while profitability showed modest recovery, supported in part by lower financial charges. Capitalization has strengthened over the past five years, although the leverage profile remains elevated. Working capital metrics moderated during FY26, while debt-servicing capacity remained adequate. Going forward, the rating will remain sensitive to sustained improvement in revenues and profitability, prudent management of working capital, and maintenance of adequate liquidity buffers.
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-2026/IRM-2026.pdf