Fitch: Rolta view to negative

Fitch Ratings said it revised the outlook on Rolta India Ltd. to negative from stable and affirmed its long-term foreign- and local-currency issuer default ratings and senior unsecured rating at BB-.

Fitch also said it affirmed Rolta LLC’s $127 million 10¾% notes due 2018 and Rolta Americas LLC’s $373 million 8 7/8% notes due 2019 at BB-. The notes are guaranteed by Rolta.

The negative outlook reflects that due to higher working capital requirements, Rolta’s leverage and free cash flow will be worse than previous expectations despite higher forecast EBITDA, the agency said.

The outlook revision also considers potential uncertainties about the company’s ability to access capital if investors believe allegations set out in a short-seller’s report, Fitch said.

The agency said it believes the company’s leverage is likely to remain high as an increase in the Indian government defense business is an important element of the company’s growth.

The company is likely to consume higher working capital and could require pre-investment to bid for new orders, Fitch added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.