Citing sharp deterioration in asset quality, Credit Analysis & Research (CARE) has downgraded ratings on long term borrowings of IFCI Ltd.
IFCI's long term instruments are rated A from A+, long term subordinate bonds from A to A-, and revised rating on long term structured debts to AA- from AA.
The outlook on these long term ratings are negative, IFCI said in a regulatory filing.
On its rating rationale, CARE said the revision in ratings to various bank facilities and instruments of IFCI factor in sharp deterioration in asset quality parameters as on December 31, 2016.
Decline in profitability with net loss during April-December also led to ratings revision.
"The ratings revision also factors in de-growth in loan portfolio and vulnerability of asset quality on account of client concentration," it added.
The ratings, however, continue to derive growth from the majority ownership by the government, adequate capitalisaiton, adequate liquidity and diversified resource profile of the company, it said further.
The company had reported net loss of Rs 140.59 crore during April-December of 2016-17.
IFCI stock closed 0.67 per cent down at Rs 29.45 on BSE.
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