Icra Scales Down Tata Coffee

Rating agency Icra has downgraded the medium-term rating assigned to Tata Coffee Ltd (TCL) from MAA + to MAA.

In a release issued today, Icra said that it has given a MAA rating to the Rs 26 crore medium-term non-convertible debenture issue as against the MAA+ rating assigned to the Rs 32 crore medium-term non-convertible debenture issue.

It, however, retained the A+ short-term rating, indicating highest safety, assigned to the Rs 20 crore commercial paper programme. "The rating downgrade reflects the continuing depression seen in coffee prices since the end of 2000 and the limited prospects of any uptrend in these prices in the short to medium term," the release said.

It added that the present debt issue would be used for funding various strategic initiatives including plantation improvement programme, the proposed joint venture in Russia, brand building efforts in Russia and its investment in Barista Coffee Company.