CARE reaffirms credit rating of ABC India's bank facilities; Stock tumbles 4%

The ratings continue to remain constrained by the concentration in the order book.

Oct 13, 2021 09:10 IST India Infoline News Service

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ABC India Ltd has informed that the rating for Long Term credit facilities from the Bankers of the Company have been reviewed and reaffirmed the existing rating as 'CARE BBB-/Stable' and for Short Term Credit Facilities have been reviewed and reaffirmed the existing rating as CARE A3 by rating agencies, viz. CARE Ratings Limited 

Further, as per rationale report, the ratings assigned to the bank facilities of ABC India continue to draw comfort from the long experience of the promoters in logistics business, diversified portfolio of services, reputed clientele and moderate order book position.

The ratings also factor in the significant increase in operating income in FY20 (refers to the period April 1 to March 31) and improvement in capital structure and debt coverage indicators, though profitability margins declined.

The ratings continue to remain constrained by the concentration in the order book, intense competition impacting profitability, susceptibility of profits to volatility in fuel prices and high collection period in the project segment.

At around 9:55 AM, ABC India was trading at Rs77.55 apiece lower by Rs2.25 or 4.14% on the BSE.

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