GE Shipping gets AAA

Crisil has assigned AAA rating for the Rs. 36 crore NCD programme of Great Eastern Shipping while PFAAA rating has been reaffirmed for the Rs. 95 crore preference share programme as also the AAA rating for the Rs. 190 crore non-convertible debenture issue.

The ratings reflect the company's diversified income flow arising from a fleet of ships catering to various segments of the shipping industry that ensures reasonable stability in earnings. Earnings protection has also been ensured through a mix of spot and time charters as well as timely sale of ships. The proactive and financially conservative management has demonstrated the ability to sustain profitability and maintain a financially strong profile with good liquidity and favourable capital structure. This also imparts the company flexibility to purchase ships whenever attractive opportunities arise without adverse impact on the financial position.

While the Rs. 150 crore equity shares buy-back programme will lead to deterioration in financial position over expected levels in 2000-01, the financials continue to be robust on account of strong cash flow from the shipping business and favourable business cycle. The key risks arise from the very nature of the shipping industry that is capital intensive, cyclical and volatile.

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Section  : Business
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