CRISIL reaffirms rating on Prima Plastics' bank facilities; Stock jumps 5%

12 Jul 2022 , 02:22 PM

CRISIL Ratings has reaffirmed its ‘CRISIL BBB/Stable/CRISIL A3+’ ratings on the bank facilities of Prima Plastics Ltd (Prima; part of the Prima group).

According to the rating rationale report, the ratings continue to reflect the group’s healthy financial risk profile, promoters’ extensive experience in the plastic-moulded furniture industry and healthy relationships with customers and suppliers.

These strengths are partially offset by large working capital requirements and susceptibility to volatility in raw material prices and to intense competition in the domestic market.

For arriving at the ratings, CRISIL Ratings has combined the business and financial risk profiles of Prima and Prima Union Plasticos SA (PUPS) as the entities, together referred to as the Prima group, are in the same business, and have common promoters and fungible cash flow. Furthermore, Prima owns 90% stake in PUPS.

At around 2:22 PM, Prima Plastics was trading at Rs86.70 per share up by 5.15% from its previous closing of Rs82.45 per share on the BSE.