Fitch assigns Shriram bonds BB+

Fitch Ratings said it assigned Shriram Transport Finance Co. Ltd.’s proposed dollar-denominated senior secured notes an expected rating of BB+.

The bonds will carry a fixed-rate coupon payable semi-annually. The notes will be secured by a fixed charge over specified accounts receivable, in line with the company’s domestic secured bonds and rupee-denominated senior secured bonds issued overseas. The proposed notes are also subject to maintenance covenants that require Shriram to meet regulatory capital requirements at all times, maintain a net stage 3 asset ratio equal to or less than 7%, and ensure its security coverage ratio is equal to or greater than 1x at all times. The proposed notes are likely to carry maturities of three to five years.

The notes will be issued in the international market by the company under the Reserve Bank of India’s new external commercial borrowings framework issued in January 2019.

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