ICRA Lanka Withdraws the Rating of Lankem Ceylon PLC
ICRA Lanka Limited has withdrawn the Issuer rating of [SL]D (pronounced SL D) assigned to Lankem Ceylon PLC (“LCEY”/ “the Company”). The withdrawal is at the request of the Company and in accordance with ICRA Lanka’s Withdrawal and Suspension Policy.
Analytical approach: The withdrawal is based on ICRA Lanka’s Policy on withdrawal and suspension of Credit Rating and the rating is based on ICRA Lanka’s issuer rating methodology, as indicated below.
Links to applicable criteria: https://icralanka.wpengine.com/issuer-rating-methodology/
About the Company:
Lankem Ceylon PLC was created by Royal Dutch Shell in 1964 primarily as an agro chemical business. As Sri Lanka started encouraging local ownership, the Company was acquired by local investors and was listed on the Colombo Stock Exchange (CSE). Over the past 25 years, Lankem has diversified into other related businesses. The Company has been present in most industry segments in the country but primarily focused on chemicals and manufacturing industries. Lankem’s Agro Chemicals, Paints and Bituminous Products had been the frontrunners in new product developments in their specific industries.
Over the years, LCEY had grown by strategic acquisitions and now constitutes a diversified group with 27 subsidiaries, which are in the manufacturing of FMCG products, import/export of agricultural inputs/commodities, distribution and freight forwarding, trading of chemicals/auto components and, managing hotels and plantations. Currently, Colombo Fort Land & Building PLC (CFLB) is the immediate parent of Lanken Ceylon PLC, which is also the largest subsidiary (including its stepdown subsidiaries) of CFLB, accounting for approximately 40% of the revenue of CFLB. Thus, LCEY is strategically important to the Group. The Company on its own also acts as a strategic investment holding company for the Group with several subsidiaries and stepdown subsidiaries being held by LCEY.
C.W. Mackie PLC is the largest subsidiary of the Lankem Group, which has recorded a noticeable growth over the past few years. Leisure sector is another important segment of the Group. LCEY has made some sizeable investments recently in the packaging segment.
Rating history for last three years:
Subsidiary of ICRA Limited
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