S&P assigns BB- rating to Jubilant Pharma

Global agency S&P has assigned investment grade, albeit on the lower side, long-term corporate credit rating to Jubilant Pharma Ltd (JPL) with a stable outlook.
It also assigned 'BB-' issue rating to the USD- denominated senior unsecured notes issued by the company.
Obligations rated 'BB' are regarded as having significant speculative characteristics, as per S&P site.
"The rating on JPL reflects the company's exposure to the highly competitive and regulated generic pharmaceuticals market, modest size, and limited product pipeline," S&P Global Ratings credit analyst Vishal Kulkarni said in a statement.
The company's presence in niche segments, limited competition, fair profitability, limited investment needs, and commitment to deleverage with internal cash flows strengthen its credit profile, he added.

"The stable outlook on JPL indicates our expectations that the company will continue to receive product approvals at a healthy rate and commercialise them especially radio pharmaceutical products over the next 12 months," Kulkarni said.
The rating agency said it may lower the rating on JPL if the company's revenue growth lags its expectation due to slower new product approvals or lower revenue from such products.
"We may also lower the rating if we see working capital needs, capex, acquisitions, or shareholder remuneration divert cash flow away from the stated purpose of debt reduction such that the currently expected leverage profile appears unattainable, it added.