ICRA downgrades Shapoorji Pallonji rating

November 26, 2018 11:28 pm | Updated 11:28 pm IST - MUMBAI

ICRA has downgraded the long-term rating assigned to the ₹18,500 crore fund-based and non-fund based bank facilities of Shapoorji Pallonji and Company Private Ltd. (SPCPL) to AA from AA+ and has reaffirmed the short-term rating at A1+.

ICRA has also reaffirmed the short-term rating of A1+ on the ₹2,500 crore commercial paper (CP) programme. The ratings have been placed on watch with developing implications.

“The long-term rating downgrade takes into account the muted sales and continued cost pressure, which has led to weak performance of the group’s real estate portfolio and slower-than-anticipated progress on asset monetisation,” ICRA said in a statement.

“This along with the funding support provided to group/subsidiary companies (primarily real estate SPVs) has resulted in an increase in SPCPL’s standalone borrowing levels, contrary to ICRA’s expectations of a reduction in the same,” it added.

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