CARE has also assigned a AA- (SO) rating to the Rs 344-crore proposed non-convertible debenture (NCD) issue of Sardar Sarovar Narmada Nigam Ltd, an SPV of the Gujarat government. The rating is based on a detailed structured-payment mechanism incorporated in a tripartite agreement to be signed between the Gujarat government, Sardar Sarovar and the trustees to the bond holders.

The rating agency has assigned a PR1+ rating to the Rs 50-crore commercial-paper programme of L&T Finance, while a AA+ rating has been assigned to the Rs 15-crore NCD issue of USV Ltd.

CARE has reaffirmed the AA rating assigned to two NCD issues of Tamilnadu Petroproducts Ltd (TPL) amounting to Rs 105 crore, and the AA+ rating assigned to the company's fixed-deposit programe has also been reaffirmed. A PR1+ rating has been assigned to Tamilnadu Petroproducts' Rs 40-crore commercial-paper programme.

CARE has, meanwhile, downgraded the Rs 95.40-crore partly convertible debenture issue and Rs 45-crore NCD issue of Gujarat Alkalies & Chemicals Ltd from AA to A, and has put the instruments on credit watch. The rating will be monitored more closely to assess the impact of emerging developments on the company's debt-servicing capability.

Gujarat Alkalies, a company promoted by the Gujarat Industrial Investment Corporation, is the leader in the caustic-soda market. The company's performance during the current year has been unsatisfactory mainly on account of overcapacity in the industry, leading to pressure on realisations. Declining margins coupled with excessive reliance on short-term debt to finance its expansion projects has impacted the company's financial position.