The Pakistan Credit Rating Agency (PACRA) has assigned the short-term rating of A2 (A Two) to the secured TFC issue of Rs 203.6 million of Al-Noor Sugar Mills Limited (ANSML), due for final redemption in October 2005. The rating denotes a low expectation of credit risk and an adequate capacity for timely payment of financial commitments. The rating assigned to ANSML's secured TFC reflects the improving trend in overall performance and financial coverage, owing to the enhanced contribution from the main sugar operations. At the same time, the rating also recognises the company's highly leveraged capital structure and strained liquidity position.
The sponsors demonstrated support in times of high liquidity requirement remains a source of comfort to the TFC holders.
ANSML issued a secured TFC of Rs 203.6 million in FY00 of a 5-year tenor, carrying a floating rate of SBP Discount Rate Plus 2.50 percent per annum with a floor of 16.5 percent and a cap of 18.5 percent.
The profit is payable on a semi-annual basis and principal in 8 semi-annual instalments commencing from Apr 02. The TFC in issue is secured by way of exclusive first charge on the MDF Board Unit and a ranking charge on other assets of the company. Currently only one instalment of the principal payable in October 05 is outstanding (principal amount: Rs 25 million). Incorporated in 1969, Al-Noor Sugar Mills Limited (ANSML) is listed on the Karachi and Lahore Stock Exchanges. The company's plant is located at Shahpur Jahania, District Nawabshah, in upper Sindh.
ANSML is a member of the Al-Noor Group of Industries, which is engaged in the sugar, insurance and modaraba sectors along with commodities trading.
The Ismail Zakaria family members and associates collectively hold 53.7 percent of the company's equity.
Apart from sugar production, ANSML also operates a Medium Density Fiber (MDF) board carrying the brand name of 'Lasani wood', which has emerged as a household name in construction.
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