Tassnief affirms Ladun rating at BBB+

Simah Rating Agency (Tassnief) maintained its long-term credit rating for Ladun Investment Co. at “BBB+” and its short-term rating at “T-4” with Stable outlook.

In an emailed statement to Argaam, Tassnief explained that the ratings reflect the company's large-scale operations, extensive experience, integrated activities across the real estate value chain, and strong governance standards.
 

The assessment of the financial risk profile takes into account strong revenue growth and improved gross margins, contributing to an overall improvement in profitability.
 

However, Tassnief noted that converting profitability into positive cash flows from operations was constrained by significant working capital requirements. These large working capital needs have led to increased debt financing, and despite the growth in equity base, recent loans have significantly raised leverage ratios. Nevertheless, these ratios remain within the company’s internal policy limits. The agency explained that all long-term debts related to specific projects will be repaid from the proceeds generated by those projects.
 

The rating is based on achieving the expected revenue growth, alongside improvements in leverage metrics and cash flow generation. The agency also warned that any deterioration in the profit profile or key risk metrics could exert downward pressure on the ratings.