Press Release

JCR-VIS Assigns Preliminary Rating to Sukuk Issue of Saif Textile Mills Limited

Karachi, April 17, 2018: JCR-VIS Credit Rating Company Limited (JCR-VIS) has assigned preliminary rating of ‘A’ (Single A) to the proposed Sukuk issue of Saif Textile Mills Limited (STML). The outlook on the rating is ‘Stable’. Sukuk rating will be converted into final rating upon review of signed legal documents.

STML is involved in the manufacturing and sale of cotton and synthetic yarn. Majority shareholding of the company is vested with Saif Holdings Limited (SHL). SHL has interests in Textile, Feeds, Energy, Health, Technology and Real Estate sectors.

The company intends to raise Rs. 750 million (inclusive of a green shoe option of Rs. 250 million) through a Sukuk issue with a tenor of 6 years inclusive of a 1 year grace period. Proceeds of the Sukuk will be utilized for capital expenditure, fixed working capital and re-profiling of the company’s balance sheet by paying off short term borrowings. Principal repayment of the Sukuk will be made in 20 quarterly installments.

Rating draws strength from the Debt Service Account (DSA) mechanism envisaged for the payment of the Sukuk and its strict implementation whereby proceeds from sales will be transferred to the DSA every month to the extent that it covers 1/3rd of the quarterly installment by the middle of every month.

For further information on this rating announcement, please contact the undersigned (Ext: 201) at 021-35311861-70 or fax to 021-35311873.

Javed Callea

Applicable Rating Criteria:
Industrial Corporates (May 2016)

Rating the Issue (June 2016)

Information herein was obtained from sources believed to be accurate and reliable; however, JCR-VIS Credit Rating Company Limited (JCR-VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. JCR-VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. JCR-VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings. JCR-VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2018 JCR-VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to JCR-VIS.

JCR-VIS Credit Rating Company Limited