Fitch rates Ambica Steel loans BBB-(ind)

Fitch Ratings said it assigned a national long-term issuer rating of BBB-(ind) to Ambica Steels Ltd., along with a BBB-(ind) rating on outstanding long-term loans aggregating Rs. 405.7 million, a national short-term rating of F3 on sanctioned non-fund based limits aggregating Rs. 1.25 billion and a national long-term rating of BBB-(ind) on cash credit limits aggregating Rs. 728.5 million.

The outlook is stable.

The ratings reflect the company's position as a relatively small-sized producer of cold-rolled stainless steel, billets and blooms, its improving profitability over the last three years driven by an upswing in the steel cycle that has resulted in financial leverage improving to 3.4 times as of 2008, Fitch said, and a diversified customer base with an increasing share of exports.

The ratings remain constrained by its low margins, limited ability to pass on raw material price increases to its end consumers, high volatility in nickel prices and higher transportation costs, the agency said.

© 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.