Highly competitive and fragmented textile industry. Limited product range and pricing power. Earnings volatility due to fluctuations in cotton prices. Established niche market position. Cost leadership. High capital expenditure needs. Improved cash flow adequacy. Good access to capital markets. Adequate liquidity. The outlook is stable, reflecting our expectation that Texhong Textile Group Ltd. can maintain satisfactory profitability, good working capital management, and good financial discipline over the next 12 months. In addition, we expect new production sites in Vietnam and Turkey to be completed and ramped up as scheduled. We could lower the rating if Texhong's profitability and financial risk profile deteriorate materially. This could happen if: (1) the company engages in large debt-funded expansion; (2) international cotton prices increase
