On June 11, rating agency Credit Analysis & Research (CARE) had revised the ratings assigned to the bank facilities of Cox & Kings. The revision in ratings takes into account lower than envisaged reduction in debt as on March 31st 2019.
“The rating strengths are tempered by exposure of the company’s travel business to macro-economic factors prevailing in the markets to which it caters and the fragmented nature of the domestic travel industry. The timeliness, adequacy of the asset monetisation and the subsequent reduction in debt remains the key rating monitorable,” CARE Ratings said in press release.
The ratings are also tempered by continued high level of pledged shares by promoters and reduced financial flexibility as a result of decline in Cox & King’s market capitalization, it added. CLICK HERE TO READ FULL REPORT
The promoters holding in Cox & Kings is 49.8 per cent as of end of March 2019 (49.34 per cent as at March 2018). Of which 63.28 per cent shares are pledged as of March 2019 (62.62 per cent in March 2018). Cox & King’s share price has also declined significantly thus curtailing the company’s financial flexibility to an extent.
The stock has plunged 77 per cent in the past year as compared to 10 per cent rise in the S&P BSE Sensex.