Aug 16, 2011 ... Jinnat Knitwears Ltd. Page 1 of 12. Address: CRISL. Nakshi Homes. (4th & 5th
Floor). 6/1A, Segunbagicha,. Dhaka-1000. Tel: 7173700-1.
CREDIT RATING REPORT ON Jinnat Knitwears Ltd. REPORT: RR/915/11
Address: CRISL Nakshi Homes (4th & 5th Floor) 6/1A, Segunbagicha, Dhaka-1000 Tel: 7173700-1 Fax: 88-02-9565783 Email: [email protected]
Analysts: Tanzirul Islam
Abdur Raahim Hasan Chowdhoury [email protected]
Entity Rating Long Term: AShort Term: ST-3
JINNAT KNITWEARS LTD.
ACTIVITY Knit Composite INCORPORATED ON
This is a credit rating report as per the provisions of the Credit Rating Companies Rules 1996. CRISL’s entity rating is valid one year for long-term rating and 6 months for short term rating. CRISL’s Bank loan rating (blr) is valid one year for long term facilities and up-to 365 days (according to tenure of short term facilities) for short term facilities. After the above periods, these ratings will not carry any validity unless the entity goes for surveillance. CRISL followed Corporate Rating Methodology published in CRISL website www.crislbd.com
Date of Rating Entity Rating Outlook Bank Facilities Ratings: Bank/FI Mercantile Bank
August 16, 2011 Long Term AStable
Short Term ST-3
Mode of Exposure (Figures in Million)
TLO* TK.174.99 WCL** TK. 20.00
blr Ablr A-
*Term Loan Outstanding **Working Capital Limit ** CRISL rated the short term facilities under long term scale in view of their revolving nature
CRISL has assigned ‘A-’ (pronounced as single A minus) rating for Long Term and ‘ST-3’ rating for Short Term to Jinnat Knitwears Ltd. (hereinafter called “JKL” or “the company”) based on both relevant qualitative and quantitative information up-to the date of rating. The above ratings have been assigned based on good fundamentals of the company which includes average financial performance, sound Group image, regular loan payment history, sound infrastructure, experienced management team. The above factors are, however, moderated to some extent by debt based capital structure, moderate liquidity, dependency on inter company loan, susceptibility to price fluctuation risk as well as other industry specific and macroeconomic factors. The Long Term rating implies that entities rated in this category are adjudged to offer adequate safety for timely repayment of financial obligations. This level of rating indicates a corporate entity with an adequate credit profile. Risk factors are more variable and greater in periods of economic stress than those rated in the higher categories. The Short Term rating indicates entities in this category have good certainty of timely payment. Liquidity factors and company fundamentals are sound. Although ongoing funding needs may enlarge total financing requirements, access to capital markets is good. Risk factors are small. CRISL also placed the company with “Stable Outlook” in consideration of its consistent business growth and demand for the products.
July 1st, 2007
CHAIRMAN Mr. Abdul Wahed
MANAGING DIRECTOR Mr. M A Jabbar
EQUITY Tk.35.79 million TOTAL ASSETS Tk.576.11 million
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2.1 Background JKL, a private limited and associate company of “DBL Group (DBL)’’, was incorporated on July 1st, 2007 with the objective of setting up a 100% export oriented composite knit garment manufacturing factory. DBL is a Group of fifteen (15) business units having exposure in textile, readymade garments, printing and packaging sectors. The Group started its venture in early 1991 with a knit garment manufacturing unit with the vision of being one of the vertically integrated leaders in export of garments, textiles products and spinning in Bangladesh. The company went into commercial operation on March, 2008 and since then it has been engaged in knitting and manufacturing knit wears for various buyers in USA, Europe and Asia. JKL has been operating with 18 lines having a production capacity of 1.30 million kg of knitting and 13.00 million pcs of garments per year. The production facility has a covered floor area of 112,000 sft with all utility facilities. The facility is built on four floors of a tenstoried building which is owned by JKL and rest of the floors of the building have been rented to other sister concerns of DBL Group. The plant is located in about 2.52 bighas land at Shardagong, Kashimpur, Gazipur, located by the side of Dhaka-Ashulia-Jamuna Bridge Highway. The company is presently operating with a paid-up capital of Tk. 20.00 million against an authorized capital of TK.100.00 million. The management is led by Mr. Abdul Wahed as its chairman. The company is being operated from Group Corporate Office located at BGMEA Complex, 12th Floor, 23/1, Karwan Bazar, Dhaka.