FINANCIAL CHRONICLE™
Dear Reader,

Registration with the Sri Lanka FINANCIAL CHRONICLE™️ would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
FINANCIAL CHRONICLE™️
www.srilankachronicle.com


Join the forum, it's quick and easy

FINANCIAL CHRONICLE™
Dear Reader,

Registration with the Sri Lanka FINANCIAL CHRONICLE™️ would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
FINANCIAL CHRONICLE™️
www.srilankachronicle.com
FINANCIAL CHRONICLE™
Would you like to react to this message? Create an account in a few clicks or log in to continue.
FINANCIAL CHRONICLE™

Encyclopedia of Latest news, reviews, discussions and analysis of stock market and investment opportunities in Sri Lanka

LISTED COMPANIES

Submit Post

Poll

Can there be another Covid-19 wave in Sri Lanka?

 
 
 

View results

STOCK MARKET TRAINING
ශ්‍රී ලංකා මූල්‍ය වංශකථාව - සිංහල
Submit Post


CONATCT US


Send your suggestions and comments

* - required fields

Read FINANCIAL CHRONICLE™ Disclaimer



Latest topics

» Shares to Buy
by abey Today at 6:47 pm

» Boga unusual Collection....
by Wickyz Today at 1:14 pm

» MILLENNIUM HOUSING DEVELOPERS PLC (MHDL.N0000)
by jehan008 Today at 1:11 pm

» EXPOLANKA HOLDINGS PLC Interim Financial Statements quarter ended 30th June 2021
by mah2903 Today at 12:42 pm

» Sri Lanka FOB prices for black tea highest in the world
by samaritan Today at 12:18 pm

» DPL Take over
by Vishwanarth Today at 12:12 pm

» HVA FOODS PLC (HVA.N0000)
by samaritan Today at 11:02 am

» INDUSTRIAL ASPHALTS (CEYLON) PLC (ASPH.N0000)
by dayandacool Today at 10:09 am

» CITIZENS DEVELOPMENT BUSINESS FINANCE PLC(CDB.N0000)
by engineer Today at 7:06 am

» LANKA ALUMINIUM INDUSTRIES PLC (LALU.N0000)
by Jana Today at 3:36 am

» RENUKA CAPITAL PLC . KZOO.N
by Pbv Today at 12:22 am

» What will happen to AMF¿??????
by Tissa Yesterday at 11:46 pm

» Expert view on AMF??
by Tissa Yesterday at 10:12 pm

» Top Foreign Trading today
by SAGA Yesterday at 9:26 pm

» Sell EXPO Buy EDEN sentiment changed to Exit EXPO Enter EDEN
by Bakkabwoi Yesterday at 8:57 pm

» What are the short term profit stocks you are planning to buy on this Monday? (Only honest ppl please)
by Hope123 Yesterday at 7:04 pm

» Discussion on mechanism to aid investors, Conducted BY Hon Finance Minister
by D.G.Dayaratne Yesterday at 6:57 pm

» LANKEM DEVELOPMENTS PLC (LDEV.N0000)
by kadik Yesterday at 6:15 pm

» FIRST CAPITAL HOLDINGS PLC (CFVF.N0000)
by dayandacool Yesterday at 5:54 pm

» Top crossings today
by SAGA Yesterday at 3:36 pm

EXPERT CHRONICLE™

MARKET CHAT


CHRONICLE™ ANALYTICS


ECONOMIC CHRONICLE

GROSS DOMESTIC PRODUCT (GDP)


CHRONICLE™ YouTube

LATEST TWEETS

You are not connected. Please login or register

FINANCIAL CHRONICLE™ » DAILY CHRONICLE™ » Singer Sri Lanka, to sell Rs1.5bn senior debt 'A(lka)' Fitch Rating

Singer Sri Lanka, to sell Rs1.5bn senior debt 'A(lka)' Fitch Rating

2 posters

Go down  Message [Page 1 of 1]

Redbulls

Redbulls
Director - Equity Analytics
Director - Equity Analytics
Apr 11, 2012 (LBO) - Singer Sri Lanka Plc, a consumer durables firm will sell 1.5 billion rupees of senior debt which has been given an expected 'A(lka)' rating, Fitch Ratings said.

Fitch had also confirmed an 'A(lka)' rating of the company. The outlook is stable.

Singer will use the money from the debenture to lengthen the maturity profile of its existing debt, which will improve liquidity and reduce its interest rate risk, Fitch said.

The full rating is reproduced below:

Fitch Affirms Singer Sri Lanka Debt at 'A(lka)'; Rates Proposed Bonds 'A(lka)(EXP)'

Fitch Ratings-Colombo-11 April 2013: Fitch Ratings has affirmed retailer Singer (Sri Lanka) PLC's (Singer) outstanding senior unsecured redeemable debentures at National Long-Term 'A(lka)'. The Outlook is Stable.

Fitch has assigned an 'A(lka)(EXP)' expected rating to its upcoming unsecured redeemable debentures of up to LKR1.5bn. The final rating on the debentures is subject to the receipt of final transaction documents conforming to information already received. A complete list of Singer's ratings can be found at the end of this release.

The proposed debentures are rated in line with Singer's existing unsecured redeemable debentures, given that the proposed issue will rank equally with the company's unsecured creditors, in the event of liquidation.

Singer aims to use the debenture proceeds to lengthen the maturity profile of its existing debt, which will improve liquidity and reduce its interest rate risk.

Key Rating Drivers
Strong market position: Singer's ratings reflect its position as a leading retailer of consumer durable products in Sri Lanka, with strong in-house brands, and a wide distribution network of over 1,000 outlets, including 381 exclusive showrooms. Its Singer and Sisil brands account for the majority of sales and are well-entrenched in the domestic market. Singer also retails global brands such as Samsung, Hitachi, HTC, Whirlpool, Beko, and Grundig, enabling it to diversify its portfolio across price points and to cater to varying customer needs.

Cyclical demand and currency risk: Singer is exposed to foreign currency risk, as the majority of its products are imported and sold domestically. Singer has reduced this risk to an extent by manufacturing nearly 30% of its products through related companies in Sri Lanka. The non-essential nature of consumer durables also means that demand fluctuates widely through economic cycles, which is a business risk for retailers such as Singer.

Well-managed consumer loans: Singer uses in-house hire-purchase (HP) financing to market its products to rural masses who otherwise have limited access to credit. HP sales accounted for almost 50% of revenue in 2011 and 2012, and typically increase proportionately during slower economic periods. Singer has managed this high-risk and highly profitable portfolio well, helped by average durations of less than one year, average loan-to-value ratios of about 85%, and strong staff incentives for debt-recovery. At end-2012, delinquent HP debt stood at 2% of the portfolio, while write-offs have been negligible.

Weaker demand in 2013: Fitch expects a slowdown in demand for consumer durables in 2013, on the back of a weak domestic economy, particularly if energy prices are increased as expected. Credit sales are likely to support revenue and profit growth during this period. However, inflationary cost pressures are likely to constrain EBITDAR margins, and together with higher working capital requirements, will result in weaker credit metrics. Nevertheless, Singer has sufficient rating headroom.

Satisfactory liquidity: Singer had sufficient approved but unutilised bank and cash reserves to meet LKR1.5bn of maturing term debt in 2013. A further LKR5.1bn of short-term debt funded working capital at company-level. Fitch estimates that in a stressed scenario, Singer is able to pay off over 60% of its short-term debt simply by disposing its inventory at a 25% discount on cost. This, combined with Singer's access to domestic banks, mitigates any serious liquidity risks in the near-term.

Rating Sensitivities

Negative: Future developments that may individually, or collectively, lead to negative rating action include:

-A material weakening of Singer's 80% subsidiary Singer Finance PLC's (SF, rated BBB+(lka)/Stable), given the strong linkages between the entities

-A sustained increase in Singer's leverage (measured as adjusted net debt/EBITDAR excluding SF) over 4.5x (end-2012: 3.4x)

-A material weakening in Singer's (company-level) liquidity profile

-Fixed charge coverage (measured as EBITDAR/interest expense + rent, excluding SF) falling below 1.25x on a sustained basis (end-2012: 2.0x)

Positive: No positive rating action is expected given rating constraints such as the inherent cyclicality of consumer durable sales

Singer's ratings;

National Long-term expected rating on proposed unsecured debentures: assigned 'A(lka)(EXP)'

National Long-term rating on LKR1.872bn outstanding senior unsecured redeemable debentures: affirmed at 'A(lka)'/Stable

National Short-term rating on LKR1bn outstanding commercial paper affirmed at 'F1(lka)'

http://www.lankabusinessonline.com/news/Singer_Sri_Lanka,_to_sell_Rs1.5bn_senior_debt_A(lka)_Fitch_Rating/375959036

samcader


Manager - Equity Analytics
Manager - Equity Analytics
What are the benefits and advantages to Singer Finance on this bond

Back to top  Message [Page 1 of 1]

Permissions in this forum:
You cannot reply to topics in this forum