Exide's NCD gets MAAA from ICRA

THE INVESTMENT Information and Credit Rating Agency (ICRA)has assigned MAAA (M triple A) rating to the Rs. 100 crore medium term debenture programme of Exide Industries (EIL), indicating highest safety. The prospect of timely servicing of interest and principal as per terms is the best. The rating takes into account the continued dominance of EIL's products in the automobile original equipment and replacement segments and its strong growth in the motorcycle segment.

The industrial batteries catering to the UPS segment have also witnessed healthy growth. The rating also considers the comfortable profitability and operating cash flows despite a relatively high gearing and the pressure on realisations due to competition.

EIL's focus on volumes and the success of both the Exide and Standard Furukawa brands have enabled it to consolidate its market position and achieve near monopoly status in the automotive OE segment. The company has also focussed on streamlining production processes, better stock management and introduction of products for new applications.

A relatively high gearing of 1.57 times as on March 31, 2000, notwithstanding, EIL's comfortable operating cash flows aided by improved working capital management and high financial flexibility are expected to contribute towards the maintenance of the highest debt servicing ability in the medium term.

- Corporate Bureau

Send this article to Friends by E-Mail

Section  : Business
Previous : PAL Credit and Capital rating downgraded
Next     : Core Healthcare rating downgraded