Press Release

VIS Assigns Initial Entity Ratings to Syntronics Limited

Karachi, December 10, 2019: VIS Credit Rating Company Limited (VIS) has assigned initial entity ratings of ‘BBB+’/A-2’ (Triple B Plus/A-Two) to Syntronics Limited (SL). The medium to long-term rating of ‘BBB+’ denotes adequate credit quality coupled with reasonable protection factors. Moreover, risk factors are considered variable if changes occur in the economy. 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’.

SL is primarily involved in the manufacturing of Ad*Star® Polypropylene Laminated Bottom Block Sacks which is mainly used as packaging in cement industry. The company also manufactures polypropylene bags used in other industries like sugar, feed, flour, fertilizer etc. Shareholding is mainly vested with the sponsoring family who are actively involved in the day to day affairs of the company. The company generates almost total sales through local clients with cement sector constituted around three fourth of sales followed by flour mills sector during FY19. Given the concentration and cyclicality in the off take sectors of the company, the business risk is considered moderate. The company reported modest increase in sales on a timeline basis mainly on the back of increasing product price while capacity utilization, with slight fall, remained around 50%. Lately, margins and profitability have witnessed an increasing trend. Although decreasing on a timeline basis, the proportion of top 10 customers in total sales has remained high. Liquidity and coverages exhibited an improving trend on a timeline basis. Leverage indicators are considered manageable amid modest equity base. The ratings, going forward, are dependent upon higher capacity utilization, reduction in client concentration with more diversification in off take segments and maintenance of overall financial indicators.

For further information on this rating announcement, please contact Mr. Maimoon Rasheed at 042-35723411-13 (Ext: 8008) or the undersigned at 021-35311861-70 (201) or email at

Javed Callea

Applicable rating criterion: Corporates (May 2019)

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (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.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.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.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 2019 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .

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