Fitch rates Kundan Rice Mills BB(ind)

Fitch Ratings said it assigned Kundan Rice Mills Ltd. a national long-term rating of BB(ind).

The outlook is stable.

The rating reflects the company's moderate financial risk profile and its established track record in the trading business with a presence across India, the agency said.

The rating also draws comfort from limited price and exchange risk, as the majority of its trades are back-to-back transactions, the agency noted.

Ratings are constrained by the company's low and volatile profitability margins given high competition in the trading business and the erratic nature of non-core trading activities, Fitch said.

The rating is also constrained by high leverage from high working capital requirements, and low margins in the trading business, the agency added.

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