VIS Maintains Entity Ratings of Indus Lyallpur Company Limited - Press Release issued by VIS Credit Rating Company Limited.

Karachi -- June 15, 2021 (PPI-OT)

Following is the text of press release issued by VIS Credit Rating Company Limited

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VIS Credit Rating Company Limited (VIS) has maintained the entity ratings of Indus Lyallpur Company Limited (ILCL) at 'BBB+/A-2' (Triple B/A-Two). Outlook on the ratings has been revised from 'Rating Watch-Developing' to 'Positive'. Long Term Rating of BBB+ reflects adequate credit quality; protection factors are reasonable and sufficient. Risk factors are considered variable if changes occur in the economy. The short term rating of A-2 indicates good certainty of timely payment. Liquidity factors and company fundamentals are sound. Access to capital markets is good and risk factors are small. The previous rating action was announced on April 22, 2020.

ILCL is a wholly owned subsidiary of Indus Dyeing and Manufacturing Company Limited (IDMC). IDMC belongs to the Indus Group which has been operating in the textile sector for over five decades. Principal activity of ILCL includes production of yarn for exports and local industry. ILCL's production facility is situated in Faisalabad.

The revision in outlook incorporates improved financial risk profile during 9MFY21 and the recovery in overall Pakistan's textile sector exports post ease in COVID-19 lockdown measures. The local textile players have benefited from the diversion of the orders from the neighbouring countries facing more severe COVID-19 crisis. During FY20, ILCL posted limited growth in topline, while overall profitability witnessed considerable decrease in comparison to the preceding...