The rating of another Rs 10 crore NCD issue of the company was also lowered to `BB' from `BBB', Crisil said in a statement. The revised rating is on account of the continued high levels of support by the company to Jindal Vijaynagar Steel Ltd (JVSL) whose credit quality had deteriorated, the rating agency said.

The downgrade also factors in the low profitability of Jindal Iron on account of domestic competition and depressed international prices, it said. The debt servicing ability of Jisco was likely to be under pressure in future due to large amounts of debt repayment in relation to the free cash flows, Crisil said.

The rating factors in Jisco's improved operating efficiency in the galvanised products and in the hot-rolled products businesses and increased market share in thegalvanised products business, it said.

The total project cost of JVSL has now gone up to Rs 5,215 crore from the Rs 3,300 originally planned, while the debt portion has now ballooned to Rs 3,650 crore.