Fitch affirms Shriram EPC

Fitch Ratings said it affirmed Shriram EPC Ltd.'s national long-term rating at A-(ind) and revised the outlook to negative from stable.

The ratings on its short-term facilities were downgraded to F2+(ind) from F1(ind).

The agency also said it affirmed its Rs. 1.8 billion long-term fund-based limits at A-(ind) and Rs. 617.5 million long-term loans at A-(ind), and downgraded its Rs. 500 million short-term loans to F2+(ind) from F1(ind), Rs. 5.5 billion non-fund based working capital limits to F2+(ind) from F1(ind) and Rs. 1 billion commercial paper program to F2+(ind) from F1(ind).

The affirmations reflect the company's good revenue growth of 20% year-over-year in 2009 and the improvement in its order book position, Fitch said.

The ratings continue to be moderated by the concentration risk in the order book and the credit quality of the top customers, the agency said.

The downgrades consider the strain on the company's liquidity and financial leverage in 2010 due to the increased build-up in the receivable levels, Fitch added.

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