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Karachi: VIS Credit Rating Company Limited announced the reaffirmation of International Textile Limited’s (ITL) entity ratings at ‘A/A2’ (Single A / A Two), maintaining a stable outlook. The ratings reflect ITL’s solid credit quality and adequate protection factors, highlighting the company’s ability to manage short-term obligations with sound liquidity, despite broader industry challenges.
ITL, a vertically integrated textile company, specializes in spinning, weaving, and processing fabrics and towels, exporting primarily to North American and European markets. The company has demonstrated steady revenue growth and a robust financial profile, despite facing sector-wide pressures such as raw material price volatility and rising energy costs.
Pakistan’s textile sector is navigating economic and environmental difficulties, with fluctuating cotton production and high operational costs impacting profitability. ITL’s focus on value-added products and imported cotton has driven recent export growth, although profitability remains squeezed by external factors.
Management at ITL is committed to enhancing margins through cost-saving strategies, including investments in solar and biogas energy and reducing finance costs. The company’s equity base has been bolstered by profit retention, maintaining a balanced debt level and ensuring acceptable capitalization and liquidity standards.
Future ratings will depend on ITL’s ability to improve margins and execute efficiency initiatives effectively, alongside maintaining strong capitalization metrics.