JCR-VIS assigns final rating to the Sukuk issue of Agha Steel Industries Limited

Karachi, August 24, 2018 (PPI-OT): Upon review of signed legal documents, JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has finalized rating of ‘A+’ (Single A Plus) to the Sukuk issue of Rs. 5 billion (inclusive of a Green Shoe Option of Rs. 1 billion) of Agha Steel Industries Limited (ASIL). Outlook on the assigned rating is ‘Stable’. JCR-VIS has assigned an entity rating of A/A-1 to ASIL.

The assigned ratings incorporate ASIL’s position as a top-tier player in the long steel sector enjoying strong brand name and recognition, healthy financial risk profile and strong debt servicing mechanism for the Sukuk. Ratings also reflect high business risk profile of the sector as evident from expected increase in competition post capacity expansion by established existing and new players (Aggregate capacity of established players increasing by around 3(x)), significant reliance of the sector on duty protection, cyclical nature of the industry and significant rupee depreciation resulting in higher working capital requirements. However, these factors are partially mitigated by healthy demand outlook due to ongoing construction activities and demand from large infrastructure projects.

For more information, contact:
JCR-VIS Credit Rating Company Limited
VIS House, 128/C,
25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: sobia@jcrvis.com.pk