Press Release

VIS Reaffirms Entity Ratings of Crescent Bahuman Limited

Karachi, May 09, 2023: VIS Credit Rating Company Limited (VIS) has reaffirmed entity ratings of Crescent Bahuman Limited (CBL) at ‘A-/A-2’ (Single A Minus/A-Two). Medium to long-term rating of ‘A-’ signifies good credit quality; protection factors are adequate. Risk factors may vary with possible changes in economy. Short-term rating of ‘A-2’ denotes good certainty of timely payments. Liquidity factors and company fundamentals are sound. Access to capital markets is good. Risk factors are small. Outlook on the assigned ratings is ‘Stable’. Previous rating action was announced on May 13, 2022.

Ratings factor in the vertically-integrated textile setup that specializes in denim fabric and garment production, continued investment in automation for efficiency enhancement, and strong export orientation with entire cotton procurement sourced locally. Ratings reaffirmation reflect strong revenue growth, consistent upward trend in capitalization driven by healthy profitability and all out-retention policy, declining leverage metrics over time and significant improvement in margins and cash flows in the current fiscal year. Business risk profile takes into account industry wide growth in exports over the last year; however, recent floods across the country, high interest rate situation, inflationary pressures, higher electricity costs and demand slow down pose risks on the sector over the medium term. Ratings are constrained by current weak macroeconomic environment globally and locally.

Export sales contribute to over 95% of entire revenues on a timeline, with garments accounting for more than four-fifth of total exports and US being the primary market. Meanwhile, local sales comprise a mix of fabric, garment, yarn, and retail sales. Client concentration risk is elevated, with heavy reliance on a single client, Levi Strauss Co.; however, long-term association of over 25 years along with high customer satisfaction underpinned by focus on quality provide sustainability and comfort.

For further information on this rating announcement, please contact Mr. Muhammad Tabish (Ext: 206) or the undersigned (Ext: 201) at (021) 35311861-4 or email at

Javed Callea

Applicable Rating Criteria: Industrial Corporates (August 2021)

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