VIS Reaffirms Entity Ratings Of STML With Positive Outlook

VIS Credit Rating Company Limited has reaffirmed the entity ratings of Sapphire Textile Mills Limited at single A Plus/A-One

KARACHI, (UrduPoint / Pakistan Point News - 6th Dec, 2019 ) :VIS Credit Rating Company Limited has reaffirmed the entity ratings of Sapphire Textile Mills Limited at single A Plus/A-One.

Long term rating of 'A+' reflects good credit quality, adequate protection factors. Risk factors may vary with possible changes in the economy. Short-term rating of 'A-1' indicates high certainty of timely payment, excellent liquidity factors supported by good fundamental protection factors and risk factors are minor. Outlook on the assigned ratings is positive. The previous rating action was announced on December 19, 2018, said press release on Friday.

The assigned ratings incorporate STML being part of the Sapphire Group of Companies. Sapphire group is amongst the leading textile exporters in the country and has presence across the broader value chain.

The group after venturing in the retail segment has successfully diversified in the denim segment. Ratings also reflect the company's diversified business risk profile with core textile operations being complemented by investment in power sector along with a sizeable portfolio of marketable securities.

Financial risk profile draws support from improvement in income from core operations with textile business posting healthy growth in profitability during Financial year 2018-19. Adjusted leverage indicators continue to remain within manageable levels while cash flow coverage of outstanding debt increased.