Fitch affirms DSI Holdings at 'BBB+(lka)'
Fitch Ratings Lanka has affirmed the National Long-term rating of DSI
Holdings Limited (DSIHL), as well as its senior unsecured debentures at
'BBB+(lka)'. The Outlook on the ratings remains Stable.
The rating affirmation reflects DSIHL's position as Sri Lanka's
largest manufacturer and retailer of footwear and the franchise of its
three main brands. The agency believes DSIHL's product range,
distribution network, brand franchise and operational model provides
some protection against increasing competition from relatively lower
cost, small scale domestic manufacturers.
Fitch also takes comfort from high import duties that have been in
place since late 2006, which have resulted in significantly lower
competition from imports.
DSIHL's strong market position, coupled with low competition from
imports, has allowed the company to increase its footwear retail prices
with relative ease.