CRISIL upgrades Thomas Cook's credit rating in both short and long term

Omnichannel travel services firm Thomas Cook (India) Ltd on Tuesday said CRISIL has upgraded its credit rating both in the short- and long-term.

"CRISIL has upgraded rating on the bank facilities of Thomas Cook (India) Ltd (TCIL) to 'CRISIL AA-/Stable/CRISIL A1+," TCIL said a statement.

The rating upgrade in the long term to 'AA-/Stable' from 'CRISIL A+/Stable' and in the short term to 'CRISIL A1+' from 'CRISIL A1' reflects Thomas Cook India Group's strong scale-up in revenue across businesses and expectations of sustained momentum driven by brisk revival in demand after the pandemic-induced disruptions, according to the company's statement.

The ratings are indicative of TCIL's strong business risk profile with leadership position in travel and foreign exchange segments and healthy presence in hospitality (Sterling Holiday Resorts) and digi-photo imaging segments, as per CRISIL Ratings.

The company has also improved its financial risk profile following sharp revival in business activity, the rating agency said.

The upgraded ratings factor in strong support from the parent company Fairfax Financial Holdings Ltd, it said.

"CRISIL's upgraded rating to 'AA-/Stable' is a strong endorsement of Thomas Cook India's leadership position across the sectors we operate in and our balance sheet strength," Madhavan Menon, Thomas Cook (India) Ltd Executive Chairman said in the statement.

The company's rapid growth after the pandemic, on the back of accelerated digital transformation and strong cost prudence has been pivotal in the delivery of record operating profits for FY23; which sustained in the first quarter of the current fiscal, it said.

Strong growth has been demonstrated across forex, travel services, hospitality and digital imaging, he said, adding, we see robust forwards for the upcoming festive season and ahead".

The Thomas Cook India Group witnessed significant scale-up in operations with 164 per cent per cent increase in overall revenue to Rs 5,091 crore in 2022-2023 from Rs 1,931 crore, owing to strong resurgence in demand and robust recovery in all business segments, it said.

The revenue witnessed sustained momentum across segments in the first quarter of FY24 with an increase of 94 per cent to Rs 1,898 crore, it said.