LRA rates Lanka IOC at AAAFebruary 2, 2015 8:38 am Print this article
Lanka Rating Agency (LRA) has assigned Lanka IOC’s (LIOC) a long- and short-term corporate credit ratings AAA and PP1 respectively. On a stand–alone credit profile, LIOC rated at AA+ and P1 and notched up on parent support. The long-term rating carries a stable outlook.
LIOC is mainly involved in distribution off auto-fuel and also has significant presence in lubricants, bitumen and oil bunkering markets.
The ratings were upheld by the company’s notable presence in auto-fuel distribution, bitumen and lubricants markets. Sri LLankan auto fuel distribution segment is a duopoly market and LIOC is the second auto fuel distributor in Sri Lanka with a market share of 18% after the state owned Ceylon Petroleum Corporation. LIOC has significant presennce in the bitumen segment.
However, the bitumen segment became highly competitive following the licenses granted to small and medium sized players. The company’s lubricant brand SERVO has a market presence of 15.8% in lube segment and is the second largest domestic player.
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