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| No impact on Tata Steel's rating due to Q1 performance: S&P |
| Press Trust of India / New Delhi Aug 31, 2009, 18:22 IST |
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Global credit rating agency Standard & Poor's (S&P) today said Tata Steel's weak performance in the June quarter will not impact the company's rating.
S&P has non-investment grade ratings on Tata Steel and its arm Tata Steel UK, with negative outlook. "...There is no impact on its ratings on Tata Steel (BB-/Negative/—) and Tata Steel UK (B+/Negative/B) from their weak operating performance," S&P said in a statement.
The recent operating performance is broadly in line with our expectations and is expected to gradually improve with some improvement in market environment, especially in Europe, it added.
The steel maker posted a consolidated net loss of Rs 2,238.53 crore for the first quarter of this fiscal. The firm had posted a net profit of over Rs 3,900 crore in the same period in the previous fiscal.
According to S&P, the rating on Tata Steel continues to be supported by the favorable business position of its India operations, significant cost-cutting measures, especially at Tata Steel UK, the recent $500 million equity issuance and good liquidity and financial flexibility.
"The rating on TSUK continues to be supported by its strategic importance to parent Tata Steel," it added.
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