(ADPnews) - Nov 15, 2010 - Indian rating agency CRISIL on Friday gave a BB rating with a "stable" outlook to the bank facilities of Triveni Enterprises.
The agency issued the following press release:
Rs.150.00 Million Cash Credit BB/Stable (Assigned)
CRISIL has assigned its ‘BB/Stable’ rating to the cash credit facility of Triveni Enterprises (TE). The rating reflects the susceptibility of TE’s operating margin to volatility in steel prices and intense competition in the steel industry, and its below-average financial risk profile, marked by high gearing and weak debt protection metrics. These weaknesses are partially offset by the TE’s established market position and the promoters’ experience in trading of steel products.
Outlook: Stable
CRISIL believes that TE will benefit over the medium term from the longstanding experience of its promoters in the trading of steel products. The outlook may be revised to ‘Positive’ in case of significant improvement in the capital structure and profitability, on a sustainable basis. Conversely, the outlook may be revised to ‘Negative’ in case of any large, debt-funded capital expenditure programme, sharp decline in the operating margin, or significant withdrawals by the proprietor.
About the Company
Established in 1972 as a sole proprietorship, Bangalore-based TE was converted into a partnership firm in 1997. The firm is an authorised dealer of products manufactured by Steel Authority of India Ltd and Rashtriya Ispat Nigam Ltd – (CRISIL rating P1+). TE has also diversified into wind power and steel fabrications.
TE reported a profit after tax (PAT) of Rs.7 million on net sales of Rs.2632 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of Rs. 11 million on net sales of Rs. 2357 million for 2008-09.
(INR 100 = USD 2.215/EUR 1.625)
Rating agency website: www.crisil.com
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