VIS Reaffirms ER Of AML

VIS Credit Rating Company Limited has reaffirmed entity ratings of double A minus/A-one to Artistic Milliners (Private) Limited

KARACHI, (UrduPoint / Pakistan Point News - 2nd Dec, 2020 ) :VIS Credit Rating Company Limited has reaffirmed entity ratings of double A minus/A-one to Artistic Milliners (Private) Limited.

The long-term rating of 'AA-' reflects high credit quality, strong protection factors, and moderate risk but may vary slightly because of economic conditions, said release here on Wednesday.

Short-term rating of 'A-1' indicates high certainty of timely payment, excellent liquidity factors supported by good fundamental protection factors and minor risk factors. Outlook on the assigned ratings is stable. Previous rating action was announced on Nov.01, 2019.

Assigned ratings take into account AML's strong financial and moderate business risk profile. Business risk profile of the denim industry is supported by stable and growing demand for denim products; US-China Trade disruption has enhanced sales as major buyers continue to diversify procurement.

Even though concerns of a second wave of Covid-19 remain elevated, we expect the order book for the company to remain strong in the ongoing year, easing our business risk apprehensions. Moreover, increased expansion by leading denim and non-denim textile players is also on account of favorable demand and expected increase in orders. AML is well positioned to tap this opportunity given the recently completed expansion in all three segments.

Assessment of financial risk profile incorporates healthy profitability indicators, strong liquidity profile and sound capitalization levels. Gross profitability improved during the outgoing year due to rupee devaluation and enhanced efficiencies.