Pal-Peugeot Ncd Downgraded

The rating of the Rs 142.41 crore non-convertible debenture (NCD) issue of PAL Peugeot Ltd has been downgraded by the Credit Rating Information Services of India (Crisil) to C from BBB with rating watch.

The new rating indicates vulnerability to default on timely payment of interest and principal, according to a Crisil release.

Citing reasons for the drastic revision of Peugeots rating, the release stated that it has been placed on rating watch due to the uncertainty on the modalities of the inflow of funds to the company from its promoters. In the absence of such an inflow, the company is likely to face some difficulty in making the interest payment slated on June 30.

A decision in this regard has been delayed due to disagreements between the partners of the venture, Premier Automobiles Ltd (PAL) and Automobiles Peugeot (AP).

Apart from Peugeot, two corporates, Nagarjuna Construction Company and JK Industries Ltd, also faced downgrading. Nagarjunas fixed deposit (FD) programme was downgraded from FA to FB plus while the rating for the Rs 1,75.5 crore partly convertible debenture (PCD) issue of JK Industries was revised to A from A plus.

The rating agency has also assigned new ratings to a few players: Bombay Dyeing secured a P1 plus for its Rs 2,00 crore commercial paper (CP).

Hindalco Industries managed triple A for its debenture issue and P1 plus for its CP. Mahavir Spinning Mills NCD, PCD, FD, CP programmes were assigned AA plus, AA plus, FAAA and P1 plus respectively.

The CP of Siemens was rated P1 plus while Vardhman Plytexs NCD got AA. Vardhman Spinning and General Mills secured AA plus, AA plus and P1 plus for its NCD, PCD, CP ventures respectively.