Timely payments and adequate protection factors earn Tahir Omer Industries ‘A-/A-2’ rating: JCR-VIS

December 11, 2018 (MLN): JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned initial entity ratings of ‘A-/A-2’ (Single A-Minus/A-Two) to Tahir Omer Industries Limited (TOIL).

According to a press release in this regard, the medium to long-term rating of ‘A-’ denotes good credit quality coupled with adequate protection factors.

The Company added that the short-term rating of ‘A-2’ denotes good certainty of timely payments. Liquidity factors and company fundamentals are considered sound.

Outlook on the assigned ratings is ‘Stable’.

“The assigned ratings take into account sizeable oilseed crushing, extraction & refining operations and established business relations with the large institutional clients operating in the edible oil and poultry feed industries,” says JCR-VIS.

Moreover, these ratings factor in relatively sound liquidity position and adequate debt service coverage ratios, albeit recent increase in leverage indicators.

“The ratings are constrained by strong competition and inherently low margins, regulatory uncertainties and high import duties as well as increased susceptibility to risk of disease outbreaks in the poultry industry, a major buyer,” explained the company, “they will remain dependent on maintenance of gross margins and debt leverage indicators at current levels.”

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