Press Release

VIS Assigns Final Ratings to the Sukuk issue of Crescent Steel and Allied Products Limited

Karachi, October 24, 2022: Upon review of legal documents, VIS Credit Rating Company Ltd. (VIS) has assigned final rating of A- (Single A Minus) to the Sukuk issue of Rs. 800m of Crescent Steel and Allied Products Limited (CSAPL). The outlook on the rating is ‘Stable’. VIS has assigned an entity rating of A-/A-2 to CSAPL dated Oct 11, 2022.

The assigned rating incorporate CSAPL’s diversified revenue streams including exposure to steel, textile, capital markets and power sector coupled with low leveraged capital structure. The rating is constrained by business risk of the steel segment, which comprises sizeable proportion of the company’s revenues. The steel division exhibits inherent cyclicality since business performance largely depends on infrastructure projects, especially pipeline augmentation projects of gas utility companies.

In FY22, revenue from steel division was reported lower due to fewer projects being materialized coupled with strain on gross margins, given surge in key inputs. The Company, however, posted higher earnings during the ongoing year largely emanating from hefty one-off dividend income received from one of its associated company. Going forward, the order pipeline of the Company looks promising as the Company has negotiated major projects, with business execution risk in one of the mega project largely mitigated as the raw material (hot rolled coil) is to be provided by the buyer. Uptick in core business is likely to support future profitability, although business remains susceptible to changes in commodity and exchange rate volatility.

CASPL has issued a privately placed Sukuk of Rs. 800m on Oct 11, 2022 for working capital purposes. The tenor of the issue is of three years and principal will be redeemed in six equal installments starting from the 6th month of drawdown. Security features of the Sukuk entail ranking charge on Fixed Assets/Constructive mortgage charge. Pricing on the issue is 6 month KIBOR +2%.

For further information on this rating announcement, please contact M. Amin Hamdani (Ext. 217) or Ms. Sara (Ext: 207) or at 021-35311861-70 or email at

Sara Ahmed

Applicable Rating Criteria: Structured Covered Bonds/Sukuk (June 2021)

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