Press Release

VIS Assigns Initial Ratings to IJ Plastic Industries (Pvt.) Limited

Karachi, January 10, 2022: VIS Credit Rating Company Limited (VIS) has assigned initial entity ratings of ‘BBB-/A-2’ (Triple B Minus/A-Two) to IJ Plastic Industries (Pvt.) Limited (IJPIL). The medium to long-term rating of ‘BBB-’ denotes adequate credit quality coupled with reasonable protection factors. Moreover, risk factors are considered variable if changes occur in the 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’.

IJPIL is involved in manufacturing of a diverse product mix of plastic packaging products. The company operates in packaging industry with growth potential and intense competition due to presence of a large number of unorganized players and dominance of some large corporates. Majority sales are to institutional clients. Topline almost doubled in FY21 on the back of higher volumetric sales and increase in product prices. Profit margins have improved in the last two years on account of increase in prices and costs rationalization. Liquidity is considered adequate in terms of cash flow coverages. Capitalization indicators are supported by profit retention and interest free loan from sponsors, which is payable at the discretion of the company. IJPIL has installed a mesh bag plant in the ongoing year while the management intends to install a new five-layered stretch film plant and corrugation plant, which is expected to become operational in 1QFY23. Enhanced operations amidst industrial expansion bode well for the company. The ratings would remain dependent on growth in turnover and equity while sustaining capitalization and debt service indicators, going forward.

For further information on this rating announcement, please contact Ms. Tayyaba Ijaz at 042-35723411-13 (Ext. 8004) and/or the undersigned at 021-35311861-66 (Ext. 306) or email at

Faryal Ahmad Faheem
Deputy CEO

VIS Entity Rating Criteria: Corporates (August 2021)

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