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Journalism of Courage
Crisil downgrades IOCL
MUMBAI: Credit Rating Information Services of India Ltd CRISIL today downgraded the Rs 17.5 crore non-convertible debenture programme of Indian Organic Chemicals Ltd IOCL as it has greater susceptibility to default.
Crisil had put the debenture programme on 8220;rating watch8221; as restructuring exercise of IOCL8217;s fibres division was on the anvil and finally downgraded it from BBB to B rating indicating high risk regarding timely payment of interest and principal.
Crisil said debentures rated B were judged to have greater susceptibility to default.
Crisil, in a statement, said the restructuring involved sale of uncompetitive PSF and Poy units, which would have aided IOCL in repaying its costlier debt and reducing the level of fixed costs. The sale, however, could not materialise and therefore the anticipated decline in overheads and interest expenses was not achieved.
Crisil said IOCL was expected to incur cash losses during 1996-97 and the financial risk was likely to increase due to deterioration in gearing and interest coverage ratios.
The alternative cash inflows, mainly through sale of real estate and investments, were not expected to materialise in the short term thus affecting IOCL8217;s ability to make timely payment of its debt obligations, Crisil added.
Kopran fares well
MUMBAI: Kopran Ltd, a leading pharmaceutical company has achieved a turnover of Rs 350 crore for the year ended March 1997 compared to Rs 290 crore. Gross profits jumped from Rs 44 crore to Rs 52.87 crore. The net profit has gone up from Rs 36.14 crore to Rs 40.09 crore. The provision for tax has increased from Rs 2.5 crore to Rs 5 crore. Exports amount to Rs 142 crore. Sales and exports of formualtions have grown by 33 .
