Karachi, October 11, 2022 (PPI-OT):VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Olympia Oils (Pvt.) Limited (OOL) at ‘A-/A-2’ (Single A Minus/A-Two). The medium to long-term rating of ‘A-’ denotes good credit quality coupled with adequate protection factors. Moreover, risk factors may vary with possible changes in the economy. The short-term rating of ‘A-2’ denotes good certainty of timely payment coupled with sound company fundamentals and liquidity factors. Outlook on the assigned ratings is ‘Stable’. Previous rating action was announced on November 11, 2021.
OOL is primarily engaged in the production and sales of edible oil and oil meal using solvent extraction process. OOL is the flagship company of “Monnoo Group” with diversified business interests in textile, poultry, carpets, chemicals and synthetics. The ratings draw strength from moderate business risk profile based on majority of the revenue emanating from bulk sales to institutional clients thereby avoiding competition from mainstream branded oil market.
The sales increased during the outgoing year on account of higher product prices despite decrease in sales volume. The company also posted relatively higher margins on a timeline basis. Leverage indicators improved considerably due to lower short-term borrowings and enhanced equity base. Liquidity profile is underpinned by adequate cash flow coverages and manageable working capital cycle. The demand outlook for consumer goods industry including edible oil, though quite inelastic, may be somewhat impacted due to recent floods in the country affecting ~33 million people. The ratings will remain dependent on maintaining profitability profile, liquidity and capitalization indicators, going forward.
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/