PACRA has assigned Initial Entity Ratings to NIMIR industrial Chemicals Limited (NICL) with a Long-Term rating of A and a Short Term Rating of A1. A stable outlook has been given.
According to the press release by the credit rating agency, the ratings of Nimir Industrial Chemicals Limited (“the company”) demonstrate its strong position in domestic manufacturing of oleo chemicals and chlor alkali products, along with a solid customer base of multinational FMCGs, strong margins, generation of persistent profitability, and former association with American’s owned Knightsbridge Group.
Established as a listed entity, a well-devised governance framework is in place. The company has established a distinguished position in its operating segment through the provision of high-quality products to large-scale multi-national companies, the report mentions.
Additionally, growing demand for consumer products and the company’s abilities to expand its capacities to cope with the demand bodes well for business prospects of the company. Advanced production facilities alongside experienced management team transpire into operational efficiencies.
Capitalizing on a topline-driven approach, the company has been expanding its business volumes since take over by the current shareholders.
The recent advancement and up gradation of the plant has been completed in FY18.
Well-devised pricing strategy indexed with dollar rates hedges against exchange risk, since the company imports various palm oil products as its major raw materials.
Sustenance of healthy margins with adequate leveraging and strong coverages are important for ratings, going forward.
The ratings are dependent on sustaining strong margins and profitability in line with business expansion; prudent management of liquidity profile and maintenance of strong coverages amidst expansion, says the press release.