S&P lowers, withdraws SAIL ratings

Standard & Poor’s said it lowered the long-term corporate credit rating on Steel Authority of India Ltd. (SAIL) to BB+ from BBB-.

The agency said it then withdrew the rating at the company’s request.

At the time of the withdrawal, the negative outlook on the company reflected the risk that further delays in the rollout of new capacity could further strain the company’s operating performance, causing its business risk profile to slip below satisfactory, S&P said.

The downgrade reflects its slower-than-expected progress in leverage reduction, the agency said.

SAIL’s partly debt-funded capital expenditure program has considerably increased its leverage, but the investments made have not contributed to higher cash flows, S&P said.

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