Lahore, May 06, 2022 (PPI-OT):The ratings reflect Sefam (Pvt.) Limited’s reputable image as one of the leading players in the clothing/home textile retail industry with several established brands. The Company operates a complete range of clothing brands targeting various segments of the retail market. The major portion of the Company’s raw material is sourced from group companies, which allows efficient supply chain management while ensuring quality.

Ratings positively take in to account the track record and presence of experienced and professional management team which possesses considerable experience in the retail business. With Bullish Sector dynamics, the Company has managed to sustain growth in revenues and margins in the retail market. Moreover, the Company has resorted to online sales as well. Topline and net profitability has been notably increased in 1HFY22. Liquidity profile of the Company is considered strong with manageable working capital cycle and sufficient cash flows to meet outstanding obligations. The capital structure remains low leveraged with strong coverages and efficient management of working capital.

The positive outlook signifies the improving revenue and profitability along with other strong financial parameters. Moreover, the comfort can also be drawn from the business risk profile backed by the healthy market position of the Company’s various brands as well as benefits from the strong financial position of the sponsors. The ratings are dependent on sustaining business performance amidst prevailing tough conditions. Maintaining strong financial profile amidst lower revenues is critical. The Company’s ability to improve the governance framework by hiring better financial auditors will remain important.

For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com