Press Release

VIS Reaffirms Entity Ratings of Fast Cables Limited

Karachi, December 28, 2020: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Fast Cables Limited (FCL) at ‘A-/A-2’ (Single A Minus/A-Two). The medium to long-term rating of ‘A-’ signifies good credit quality with strong protection factors. Moreover, risk factors may vary with possible changes in economy. The short-term rating of ‘A-2’ denotes good certainty of timely payments coupled with sound liquidity and company fundamentals. Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on December 17, 2019.

The ratings assigned to FCL take into account its position among the top tier cable manufacturers with sizable market share and brand equity of quality cables provider. Business risk profile is characterized by temporary slowdown in demand on account of lower projected GDP growth amid pandemic crisis, high competition from the informal sector and imports and risk of margin attrition due to currency devaluation. However, overall business risk profile is supported by stable and growing demand for wires & cables in the long run. The ratings take into account the reliance of the power sector on the company’s products used during transmission and distribution of electricity. Further, the ratings incorporate steady growth in sales emanating from securing contracts from government, semi-government and premium private sector electricity generation companies in Pakistan. The ratings factor in sound financial risk profile emanating from fair liquidity profile, margins, coverages and augmented equity base. Albeit, inherent business risk pertaining to volatility in raw material prices and rupee depreciation is considered manageable, the same remains an important factor for the ratings. Going forward, ratings remain sensitive to increasing uncertainty surrounding ongoing second wave of COVID-19, growth in revenues, improvement in margins and managing leverage indicators around current levels.

For further information on this rating announcement, please contact Ms. Maham Qasim (042-35723411-13, Ext. 8010) and/or the undersigned at 021-35311861-66 (Ext. 201) or email at info@vis.com.pk .



Faryal Ahmad Faheem
Deputy CEO

Applicable rating criterion: Corporates (May 2019)
https://www.vis.com.pk/kc-meth.aspx

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS , the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2020 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .