Fitch upgrades Abans to A(lka) rating

Fitch Ratings Lanka has upgraded Aban's National Long-Term Rating to A(lka) from A-(lka).

Following the upgrade the outlook on the rating is 'Stable'.

When upgrading Abans' rating the agency has taken into account the notable improvements that Abans have initiated to its Management Information Systems, in terms of integration and internal reporting aspects, as well as internal controls.

Fitch believes that such improvements will help Abans monitor their performance of its various divisions, including management of working-capital across its large base of outlets as well as consumer loan-book.

Further, the management's strategy to limit growth of its consumer-financing operation is viewed positively, given the current economic environment. In their report, Fitch have noted that 'Despite the high inflationary pressure on consumer spending, Abans sales have been robust.'

However, Fitch does not expect Abans to maintain historic levels of growth over the medium term given the weakening macro-economic environment, which they think will not materially improve for sometime.