PACRA Maintains Entity Ratings of Tufail Chemical and Surfactants (Private) Limited - Press Release issued by The Pakistan Credit Rating Agency Limited.

Lahore -- December 31, 2020 (PPI-OT)

Following is the text of press release issued by The Pakistan Credit Rating Agency Limited (PACRA)

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Tufail Chemical and Surfactants (Pvt.) Limited's (the Company) ratings reflect adequate business profile of the Company, characterized by a relatively limited capacity and modest profitability. The Company is associated with Tufail Chemical Industries Limited and majority of its surfactants (LABSA and SLES) sales are channelled through Tufail Chemical Industries Limited. Thus, the Company's sales remain a factor of overall demand and how it will be benefited at group level. Historically, dumping by various international players has squeezed the margins of the Company.

Imposition of anti-dumping for five years on sulphonic acid imports from various countries, since May-17, has helped the Company in sustaining its profitability. The R and D is done at Group level which has helped the Company in commissioning new surfactants variants. This, alongside continuous BMR activities and experienced management team transpires into operational efficiencies, in turn, improved product profile and stable margins despite challenging environment. The demand for the Company's products is expected to remain intact with rising income and hygiene awareness.

Meanwhile, the Company has modest financial risk profile, characterized by moderate leveraging, healthy coverages. The Company finances its working capital needs through short term borrowing leading to relatively limited cushion at trade assets level...