Karachi, December 29, 2021 (PPI-OT):VIS Credit Rating Company Limited has assigned initial entity ratings of ‘A-/A-2’ (A Minus/A-Two) to Zahra Textile (ZT). Long Term Rating of ‘A-’ reflects good credit quality with adequate protection factors. Risk factors may vary with possible changes in the economy. Short Term Rating of ‘A-2’ signifies good certainty of timely payment, sound liquidity factors and company fundamentals, and good access to capital markets. Risk factors are small. Outlook on the assigned ratings is ‘Stable’.

Zahra Textile (ZT) is a family owned partnership concern primarily engaged in manufacturing and sale of yarn. The Company has a small paper and paper board segment producing brown paper as raw material for producing corrugated box cartons. Manufacturing facility is located in Nooriabad District Jamshoro, Sindh while Head office is based in Karachi.

The assigned ratings take into account long time experience of sponsors and positive growth in revenue over time supported by sound margins and higher operational efficiencies resulting in strong balance sheet footing. Positive outlook of the textile sector on the back of higher demand in export market bodes well for ZT. Ratings also incorporate strong capitalization indicators reflective of Company’s conservative financial policy status. Corporate governance structure provides room for improvement. Going forward, achieving sustained profitability and maintaining sound capitalization indicators will be important for ratings.

For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/