Karachi, March 31, 2023 (PPI-OT): The business and financial risk of the steel sector has increased on a timeline basis emanating from import restrictions, limited raw material coverage, soaring raw material prices, exchange rate volatility, and higher interest rates, resulting in inflationary pressures and a decline in demand in the construction, engineering, automobiles and infrastructure development projects.
The ongoing situation is expected to persist in the mid-term impacting the financial risk profile of companies across the sector. Accordingly, VIS Credit Rating Company Limited (VIS) has placed the steel sector and the companies rated therein by VIS under ‘Rating Watch’ status.
Frontier Foundry Steel (Pvt.) Ltd. (FFSL) has been assigned entity rating of ‘A/A-1’ (Single A/A-One), announced on February 22, 2023. Outlook on the same is revised from ‘Stable’ to ‘Rating Watch – Developing’ status. Long-term entity rating of ‘A’ denotes good credit quality with adequate protection factors. Moreover, risk factors may vary with possible changes in economy. Short-term entity rating of ‘A-1’ indicates high certainty of timely payment, excellent liquidity factors and good company fundamentals. Risk factors are minor.
The ratings will remain under Rating Watch based on the unfolding of the economic and market developments going forward and updated over time line according to availability of financial information.
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
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