Karachi: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Almoiz Industries Limited (AMIL) at ‘A/A-2’. The ratings reflect good credit quality and a stable outlook, indicating sound liquidity and a good likelihood of meeting short-term obligations. This announcement follows a previous ratings action taken on August 2, 2023.

According to VIS Credit Rating Company Limited, AMIL maintains its medium to long-term rating at ‘A’, suggestive of adequate protection factors and a good credit quality, despite potential economic fluctuations. The short-term rating of ‘A-2’ underscores a favorable short-term liquidity scenario, supporting timely repayment of obligations. The outlook for these ratings is stable, reflecting consistent performance indicators despite industry challenges.

AMIL, part of the Almoiz Group and incorporated on May 5, 2005, operates in seasonal manufacturing of sugar and steel products across multiple facilities in Pakistan, including a notable footprint in Dera Ismail Khan and Mianwali. The company is unique in Pakistan for producing sugar derived from both sugarcane and beetroot, a distinction that contributes to its business model’s resilience against seasonal and cyclical industry changes.

The assigned ratings consider the moderate business risk profile typical of Pakistan’s sugar industry, characterized by low cyclicality and notable seasonal impacts. Despite competitive pressures and cost concerns impacting profitability, financial health remains anchored by recent improvements in operational outcomes and strategic management of procurement and pricing strategies.

The ratings are sensitive to shifts in sugarcane pricing, procurement strategies, and broader economic conditions. Future evaluations will focus on the company’s ability to manage and mitigate these risks while improving profitability, liquidity, and capital structure in a challenging market environment.