February 20: ICRA has downgraded the fixed deposit (FD) programme of DCM Shriram Leasing & Finance (DSLF) from `MB-' to `MD', indicating either already in default or expected to default. The revised rating takes into account the deterioration in asset quality and the consequent increase in non-performing assets.A sharp fall in FD renewal rate has adversely affected the company's liquidity position and ICRA expects this to continue into the medium term.ICRA has also downgraded the partly convertible debenture (PCD) programme of DCM Limited from `LB' to `LC' indicating substantial risk and has been placed under rating watch, an ICRA release said.
The company's real estate business which did not take off as expected has had a negative effect on its financial performance, according to ICRA. ICRA has upgraded the rating of Dena Bank's long term sub-ordinated bonds of Rs 100 crore, from `LAA-' to `LAA', indicating highest safety.
The bank's proposed bond issue of Rs 200 crore has also been assigned `LAA'.The highest safety rating has also been assigned to its certificate of deposit programme of Rs 500 crore. According to an ICRA release, the bank has registered a 20 per cent growth in deposits while credit growth was lower at 12 per cent as on September 1997.
Lower cost of deposits and lower non-performing asset generation have contributed significantly to Dena Banks profits. Another bank, Punjab National Bank has been assigned highest safety (`LAA+') for its bond programme, `MAA+' for its term deposits and `A1+' for its certificate of deposit.
ICRA has downgraded the fixed deposit programme of Phoenix International Finance, from `MA' to `MB', indicating inadequate safety.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
