Karachi: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Sunrays Textile Mills Limited (SUTM) at ‘A-/A-1’, signaling good credit quality and a strong likelihood of timely repayment obligations. The long-term rating reflects stable protection factors, while the short-term rating highlights excellent liquidity.

According to VIS Credit Rating Company Limited, the ratings acknowledge both the medium to high business risk profile of the textile sector and the individual financial robustness of SUTM. The sector faces local and global economic challenges, intense competition, and sensitivity to economic cycles, influencing demand and operational liquidity due to delayed government refunds.

SUTM, a key component of the Indus Group of Companies, has maintained a diverse operation across cotton ginning, yarn spinning, and home textiles, with additional ventures in wind power. The company’s trade, manufacturing, and sale of yarn have benefited from an improved margin due to enhanced efficiency from new machinery, despite ongoing pressures from rising input costs, particularly energy.

The assigned ratings reflect the company’s ability to manage its gearing and liquidity under challenging conditions. The future outlook remains stable, hinging on SUTM’s capacity to navigate input cost fluctuations and maintain its financial health in alignment with its ratings.