MUMBAI, March 16: ICRA Ltd has assigned an A1+ rating to the Rs 25-crore commercial paper (CP) programme of Bongaigaon Refinery & Petrochemicals Ltd (BRPL), indicating the highest safety.The rating reflects the assured returns from its refinery unit, its comfortable liquidity position and a high degree of financial flexibility derived from a very conservative capital structure.
The integrated manufacturing process of BRPL insulates it from fluctuations in raw material prices for petrochemical products. In addition, it reduces dependence on external suppliers for critical intermediate inputs. However, operational inefficiencies, particularly in the PSF unit, have marginalised the gains of integration to some extent. BRPL is also at a locational disadvantage in the PSF and DMT market as compared to its competitors. The drop in average domestic prices of PSF and DMT from 1995-96 to 1996-97 has led to a substantial decrease in the profitability of the petrochemical and the PSF unit.
The rating agency hasassigned an A1 rating to the Rs 10-crore CP programme of Tide Water Oil Co (India) Ltd (TWO). The company's medium-term non-convertible debenture (NCD) programme for Rs 7 crore has been assigned a rating of MA+, which indicates adequate safety.
The rating reflects TWO's established position in the lubricants industry, the strong brand equity of Veedol, expected improvement in operational performance during the current year and a reasonably comfortable liquidity position.
Meanwhile, Icra has downgraded the rating assigned to the Rs 1.5-crore NCD programme of Rama Pulp and Papers Ltd (RPPL) to the default category. The downgrade takes into account strained liquidity conditions which have affected the ability of RPPL to service interest and principal obligations as per terms.
The Credit Rating Information Services of India Ltd (Crisil) has reaffirmed the triple-A rating assigned to the fixed deposit programme of Tata Investment Corporation Ltd (TICL). Crisil feels that the proposed merger of Investa Ltdwith TICL is not expected to have a significant bearing on the financials of TICL considering the relatively small size of Investa Ltd, reasonably high market value of Investa's investment portfolio and moderate gearing levels.
TICL, originally promoted by Tata Sons, is involved in investment activities and is a member of the OTCEI. The company holds considerable strategic importance on account of its holdings in various Tata companies.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
