India Ratings and Research (Ind-Ra) has affirmed
Shriram Transport Finance Company ratings in respect of Long-Term Issuer Rating at IND AA+ while resolving the Rating Watch Negative (RWN). The Outlook is Stable. The Short-Term Issuer Rating has been affirmed at IND A1+.
“The RWN resolution reflects a significant recovery in the funding and liquidity scenario, and a gradual month-on-month recovery in company’s operations and key operating metrics, including collections and disbursements over April-October 2020,” company said in a regulatory filing on Tuesday.
The rating on Non-convertible debentures was reaffirmed at IND AA+/RWN IND AA+/Stable. On Bank loans Ind-Ra rating was revised to IND AA+/Stable/IND A1+ from IND AA+/RWN/IND A1+. On Subordinated debt the rating was revised from IND AA+/RWN to IND AA+/Stable. The rating on Short-term debt/ commercial paper (CP) programme was reaffirmed at A1+. On term deposit IND tAA+/RWN rating was revised to IND tAA+/Stable
Ind-Ra had placed the ratings on RWN on May 4, 2020 following the measures taken by the authorities to contain the spread of the Covid-19 pandemic, and the resulting uncertainty on the duration of measures undertaken and the impact of the same on STFC’s funding liquidity and credit costs.
The agency had taken a cautious stance towards the tightening market conditions, which could have impacted the funding sources and funding costs for STFC, which have already been elevated since the onset of the liquidity crisis for non-banking finance companies (NBFCs) in September 2018.
At around 2.28 pm, Shriram Transport Finance Company Ltd was trading at Rs1,065.55 per piece up by Rs2.6 or 0.24% on the BSE.