Fitch lowers SMRP view to stable

Fitch Ratings said it revised the outlook on Samvardhana Motherson Automotive Systems Group BV (SMRP) to stable from positive and affirmed its long-term issuer default rating at BB+.

Fitch also said it affirmed SMRP's senior secured bonds at BBB-.

The ratings reflect SMRP's strong linkages with its shareholders, Motherson Sumi Systems Ltd. and Samvardhana Motherson International Ltd., given the aligned economic interests, the agency said.

Fitch said it rates SMRP based on Motherson Sumi's consolidated financial profile.

The outlook revision reflects the agency's revised expectations for Motherson Sumi's profitability and leverage over the next few years, following a weaker-than-expected performance in the financial year ending March 2019, the agency said.

The deterioration was due to slower-than-anticipated ramp-up at SMRP's newly commissioned plants, which led to weaker profitability and higher working capital, Fitch said.

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