Fitch assigns 'BBB+(lka)' to DSI Holdings proposed Rs.300m debenture issue

RATING: Fitch Ratings Lanka assigned an expected 'BBB+(lka)' rating to DSI Holdings Limited ("DSIHL", rated National Long-term 'BBB+(lka)'/ Outlook Stable) proposed Rs.300 million debenture issue.

The company retains the option to upsize the issue up to a maximum of Rs.500m.

The issue proceeds will be primarily utilised to replace some of its existing short-term borrowings.

As at end-H107, DSIHL had total debt amounting to Rs.958m of which broadly 87% corresponded to short-term working capital related loan facilities.

Management recently increased its committed bank credit lines by Rs.500m to back-up liquidity, and expects further enhancements of around Rs.200m in the near-term. DSIHL is the country's largest manufacture and retailer of footwear in terms value, volume and points of presence.

It is a fully-owned subsidiary of the D. Samson Group (Pvt) Limited, and was formed in July 2006 as part of the group's strategy to seek equity financing from capital markets.