Fitch rates MEP Toll Road loans A+(ind)

Fitch Ratings said it assigned A+(ind) ratings to MEP Toll Road Pvt. Ltd.'s outstanding long-term project bank loans aggregating Rs.748.0 million.

The rating factors in the established track record of toll collections and debt service, modest but satisfactory coverage levels and the significant de-leveraging that has been achieved so far with the entire debt expected to be fully paid by November 2008, Fitch said. The rating also benefits from a strong contractual framework that envisages a bi-weekly transfer of the toll collections into an escrow account, the agency added.

Key credit risks include seasonal variations in traffic patterns and the existence of multiple competing routes into the city of Mumbai, the agency said.

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