Press Release

VIS Reaffirms Entity Ratings of Mehran Spice & Food Industries (MSFI)

Karachi, November 28, 2022: VIS Credit Rating Company Limited (VIS) has reaffirmed entity ratings Mehran Spice & Food Industries (MSFI) at ‘A-/A-2’ (Single A Minus/A-Two). Outlook on the assigned ratings is ‘Stable’. 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’ signifies good certainty of timely payment. Liquidity factors and company fundamentals are sound. Access to capital markets is good. Risk factors are small. Previous rating action was announced on December 14, 2021.

MSFI was established in 1975 and operates as a family-owned partnership concern. MSFI is one of the leading multi-category food companies with its presence both in Pakistan and in the export market. MSFI’s poduct portfolio comprises spices, recipe mix spices, rice, pickles, chutneys and sweet items.

Assigned ratings incorporate MSFI’s stable market position and well established distribution network having presence across Pakistan and in the export markets. MSFI currently has strong market presence in KSA and UAE; efforts are underway to increase foothold in other regions including USA, Europe, and Africa. Ratings also take into account the Company’s low business risk profile supported by low cyclicality and improving financial risk profile on a timeline basis. However, corporate governance framework, operating as a partnership concern remains a rating constraint.

Topline of the company depicted a noticeable improvement during FY22 due to PKR devaluation with around four-fifth of the sales revenue comprising exports. Ratings also take into account healthy liquidity profile, which is evident from strong cash flow coverages against outstanding obligations. Significant cash and bank balances on the books provide support to the liquidity profile of the company. Capitalization profile gathers support from low-leveraged financial policy keeping leverage indicators on the lower side. Going forward, sustainable growth in revenues and strengthening of equity base while maintaining low leveraged capital structure will be important for ratings.

For further information on this rating announcement, please contact Ms. Asfia Aziz (Ext: 212) or the undersigned (Ext: 207) at (021) 35311861-66 or email at

Sara Ahmed

VIS Entity Rating Criteria Methodology – Industrial Corporates (August 2021)

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