Karachi, September 17, 2020 (PPI-OT): VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of Olympia Oils (Pvt.) Limited (OOL) at ‘BBB+/A-2’ (Triple B Plus/A-Two). The medium to long-term rating of ‘BBB+’ denotes adequate credit quality with reasonable protection factors. Moreover, risk factors may vary with possible changes in economy. The short-term rating of ‘A-2’ denotes good certainty of timely payments coupled with sound liquidity and company fundamentals. Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on May 31, 2019.
OOL is primarily engaged in the production and sales of edible oil and oil meal using solvent extraction process. OOL is the flagship company of a diversified industrial conglomerate “Monnoo Group” having business interests in textile, carpets, chemicals, synthetics, and poultry. The ratings draw strength from moderate business risk profile based on majority sales to institutional clients thereby avoiding competition from mainstream branded oil market.
The ratings also incorporate lower demand risk of oil meal due to vertical integration with group owned feed mills which utilize around half of production output. The ratings also draw comfort from minimal reliance on long term borrowings and adequate debt service coverage. Leverage indicators have decreased while margins have witnessed some improvement during the outgoing year; the trend of which needs to be seen overtime. The ratings take into account the price sensitivity of imported raw material and exchange rate fluctuations and the competitive landscape of the industry.
For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/