Ind-Ra revises Prism Johnson's Outlook to Positive; Affirms 'IND A+'

The credit rating agency continues to take a consolidated view of PJL and its subsidiaries, because of strong operational and strategic linkages among them.

Aug 18, 2021 03:08 IST India Infoline News Service

India Ratings and Research (Ind-Ra) has revised Prism Johnson Limited's (PJL) Outlook to Positive from Stable while affirming its LongTerm Issuer Rating at 'IND A+'. The rating on commercial paper has been affirmed at 'IND A1+'.

Ind-Ra has assigned the Credit Rating ‘IND A+/Positive’ to the proposed new issue of Unsecured Rated Listed Redeemable Taxable Non-convertible Debentures, Tranche - XVIII of Rs95cr of the Company on private placement.

“Ind-Ra continues to take a consolidated view of PJL and its subsidiaries, _ together referred to as PJL, because of strong operational and strategic linkages among them. PJL completed the amalgamation of some of its subsidiaries with itself in May 2021, to ease out the group structure,” company said.

Describing the rationale of rating, Ind-Ra said in a statement shared by the company on Tuesday. “The Positive Outlook reflects the continued better-than-Ind-Ra-expected performance of PJL with net leverage of 1.9x in FY21, which improved further to 1.6x in Q1FY22, despite the impact of the second COVID-19 wave induced restrictions and Ind-Ra's expectation of net leverage sustaining below 2x over the near-to-medium term.

Continued Strengthening of Financial Profile: Despite the adverse impact of COVID-19 and its second wave, PJL's FY21 net leverage (net debt/EBITDA) improved to 1.9x in FY21 (FY20: 3.4x) and further to 1.6x in 1QFY22, led by a significant improvement in its profitability and reduction in net debt. Despite a weak demand in tiles business HR Johnson (HRJ) and ready-mix concrete (RMC) segments due to restrictions in Q1FY22, the company's EBITDA increased to Rsl.2 billion (1QFY21: Rs0.2 billion) while the net debt reduced to Rs13.2 billion (1QFY21: Rs15.5 billion).”

Prism Johnson Ltd ended at Rs131.95 per piece down by Rs0.65 or 0.49% from its previous closing of Rs132.60 per piece on the BSE.

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