CRISIL upgrades ratings on Prince Pipes and Fittings bank loan facilities

The long-term rating has been upgraded to CRISIL A/Positive from CRISIL A-/Stable.

Jul 14, 2021 03:07 IST India Infoline News Service

Prince Pipes and Fittings
CRISIL Ratings has upgraded its ratings on the total bank loan facilities o Rs469cr of Prince Pipes and Fittings Limited (PPFL). The long-term rating has been upgraded to CRISIL A/Positive from CRISIL A-/Stable and the short-term rating has been upgraded to CRISIL A1 from CRISIL A2+.

“The rating upgrade reflects CRISIL’s expectation that PPFL’s business risk profile will continue to strengthen over the medium term backed by steady top-line growth and profitability.

The company registered almost 27% y-o-y growth in revenue in fiscal 2021, primarily driven by average realization rising by almost 22% y-o-y, and supported by volumetric growth of almost 4%,” company shared CRISIL Ratings rating rationale.

It further said, sharp increase in raw material prices mainly that of polyvinyl chloride (PVC), drove the realization in the year. Increased revenue and inventory gains led to sharp jump in operating profitability at 17.6% in fiscal 2021 up from 14.1% in fiscal 2020. Notwithstanding moderation in raw material prices, steady demand from affordable housing segment, plumbing and SWR segments, driven by government’s focus on providing water supply and higher budgetary allocations for urban development will continue to drive the revenue growth for the company over the medium term.

At close, Prince Pipes & Fittings Ltd was trading at Rs707 per piece down by Rs13.35 or 1.85% from its previous closing of Rs720.35 per piece on the BSE.

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