Ratings of Shahmurad Sugar Mills Ltd reaffirmed

Karachi, August 31, 2012 (PPI-OT): JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the entity ratings of Shahmurad Sugar Mills Limited (SSML) at ‘BBB+/A-2’ (Triple B Plus/ A-Two). Outlook on the ratings is ‘Stable’.

SSML is involved in the production of sugar as well as ethanol. Ratings take into account the fairly diversified operations of the company with both divisions having different market dynamics. With excess sugar production during the on-going season, sugar prices remain under pressure, resulting in lower margins. However with increase in international oil prices, the company enjoyed higher margins on ethanol and is expected to continue to gain from the same.

Debt leverage of the company is considered to be on the higher side. There may be some stress on debt servicing coverage. Future price trends for impact on cash flows of the company will continue to be closely tracked by JCR-VIS.

For more information, contact:
Mr. Javed Callea
JCR-VIS Credit Rating Company Limited
Tel: +9221 35311861 (10 lines) (Ext: 501)
Fax: +9221 35311872-3
E mail: javed.callea@jcrvis.com.pk

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