Pakistan Credit Rating Agency Limited maintains rating of Sukuk Issue of Amreli Steels Limited

Lahore, May 16, 2014 (PPI-OT): The Pakistan Credit Rating Agency (PACRA) has maintained the rating of privately placed, secured Sukuk of PKR 880mln by Amreli Steels Limited (ASL) at ‘A-’ (Single A Minus). The rating denotes a low expectation of credit risk emanating from a strong capacity for timely payment of financial commitments.

The rating reflects strong business acumen of ASL’s sponsors and their demonstrated financial support. ASL has been able to improve its profitability through higher capacity utilization and improved margins, despite volatility in international steel market and increase in domestic energy prices.

Resulting increase in cashflows has provided some relief to coverages. However, overall financial profile remains stressed owing to short-term liquidity mismatch, given consistent rise in working capital. Cognizant of this, the debt re-profiling process is in place to improve debt mix by substituting a portion of short-term loan with long-term loan.

Currently, besides achieving optimal operational performance, the company is working on a business strategy, by virtue of which, ASL would further strengthen its foothold in south region, mainly key urban cities of Sindh. This is likely to benefit business margin.

For more information, contact:
Hammad Rashid
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com

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The post Pakistan Credit Rating Agency Limited maintains rating of Sukuk Issue of Amreli Steels Limited appeared first on AsiaNet-Pakistan.

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