Redington (India) gets P1 plus

Crisil has assigned P1 plus rating to the Rs. 80 crore short term debt programme of Redington India (RIL). The rating reflects RIL's strong market position in the domestic IT (information technology) distribution industry, wide product portfolio, diversified vendor base and systems driven nature of the company's operations supported by efficient logistics management. The rating also factors in the favourable financial risk profile of the company as reflected in high revenue growth, comfortable gearing and strong cash flow protection measures.

However, the rating is tempered on account of the high degree of competitive pressures in the domestic market, inventory exposure risks and inherently low margins associated with IT distribution industry; and RIL's small net worth base. In future, while RIL is expected to sustain its strong market position and high turnover growth, the ability of the company to improve its margins in a competitive market place through efficient working capital management and increasing focus on high margin product categories (including service) would determine the company's credit risk profile.

Redington India, belonging to the Singapore-based Kewalram Chanrai group was incorporated in 1993 and is involved in trading and distribution and sale of IT and office automation products.

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Section  : Business
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