Nov 15, 2008 (LBO) – Fitch Ratings Sri Lanka has confirmed a BB+(lka) long term rating of Trade Finance and Investment Ltd (TFI) with a stable outlook. “TFI’s rating factors its high capitalisation in terms of its size of operations and good profitability,” Fitch Ratings said.
“The rating is constrained by TFI’s small asset base, limited product diversity and its narrow funding base.”
TFI is a 30 year old company has which is in lease and hire purchase of mainly three-wheelers vehicles in Sri Lanka.
Three-wheelers accounted for approximately 90 percent of assets financed at the six-month period ended September 2008.
In 2007, due to emission concerns, the government of Sri Lanka has banned the import of two-stroke Bajaj three-wheelers with effect from early 2008, with a further ban on spare part imports from 2011.
This restricted fresh imports to just the four-stroke three-wheelers.
Fitch says despite the ban, the second hand market for the two-stroke three wheelers remains robust due to perceived cost considerations in maintenance of the four-stroke engine and significant market stocks of spare parts.