Care Ratings grades the long term and short term bank facilities of Global Trading Concern Private Limited worth Rs.1.19 Arba

CARE Ratings Nepal Limited (CRNL) has assigned rating of ‘CARE-NP BBB-’ to the long term bank facilities worth Rs.225.46 Million and ‘CARE-NP A3’ to the short term bank facilities worth Rs.970.30 Million of Global Trading Concern Private Limited (GTCPL).

The ratings assigned to the bank facilities of GTCPL derives strength from long track record of operation along with established and diversified dealer network, authorized distributorship of different types and brands of liquor for Nepal including strong global brands as major portfolio and liquidity profile supported by liquid investments in listed shares. The ratings also factor in strong promoters and experienced management team in related field and increasing demand of liquor products in Nepal.

The ratings are, however, constrained by deteriorated financial performance during FY18, leveraged capital structure although moderate debt service coverage indicators and working capital intensive nature of operations exposed to volatile interest rates. The rating also factors in exposure to liquor related government policies, foreign exchange fluctuation risk and competition from other domestic as well as international liquor brands.

Ability to profitably scale up the operations and effective management of working capital with improvement in solvency position and ability to sustain various government policies related to liquor remain the key rating sensitivities.

Global Trading Concern Private Limited (GTCPL) is a private company, incorporated on November 30, 1998. It is an authorized exclusive distributor of Assorted Spirits (which include Whiskey, Vodka, Rum, Gin, Brandy and Tequila) of Diageo Plc United Kingdom (UK) and its associate companies. The company is also distributor for wine from different countries, Beer of Heineken International and Bira91 of India for Nepal. It imports liquor products from various countries and distribute to dealers and key accounts all around Nepal.

Source: Care Ratings Nepal