Sobha Developers gets quality safety rating for its debt
Sobha Developers Ltd has received ratings from ICRA, reflecting safety of funds deployed in the leading real estate firm with prestigious projects in South India.
By PTI |
NEW DELHI: Sobha Developers Ltd has received ratings from ICRA, reflecting safety of funds deployed in the leading real estate firm with prestigious projects in South India.
The rating agency has assigned two levels of quality standard -- adequate credit safety 'LA' and highest credit safety 'A1' for a total of Rs 100 crore of debt.
The instruments rated in this category carry the lowest credit risk in the short term, ICRA said.
"The rating reflects Sobha's established position in the residential property segment in Bangalore, its strong project execution track record and significant improvement in its financial risk profile following its initial public offer," the agency said.
Sobha Developers' status in the contract construction provides diversity to its revenue stream and partly mitigates the risk associated with the cyclical nature of real estate, ICRA said.
It expects the company to post a healthy growth in the revenues and profits.
The company has taken steps to reduce concentration risks arising from its presence primarily in the residential segment in the Bangalore real estate market.
However, it's "ability to successfully compete in new segments across different geographies is yet to be demonstrated," ICRA said.
In a separate exercise, ICRA reaffirmed highest credit rating to Rs 500 crore short term debt of cement major ACC.
The rating factors in ACC's improved financial profile, its strong market position, pan-India presence and favourable demand and supply outlook for the domestic cement industry in the short term, ICRA said.
The rating agency has assigned two levels of quality standard -- adequate credit safety 'LA' and highest credit safety 'A1' for a total of Rs 100 crore of debt.
The instruments rated in this category carry the lowest credit risk in the short term, ICRA said.
"The rating reflects Sobha's established position in the residential property segment in Bangalore, its strong project execution track record and significant improvement in its financial risk profile following its initial public offer," the agency said.
Sobha Developers' status in the contract construction provides diversity to its revenue stream and partly mitigates the risk associated with the cyclical nature of real estate, ICRA said.
It expects the company to post a healthy growth in the revenues and profits.
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The company has taken steps to reduce concentration risks arising from its presence primarily in the residential segment in the Bangalore real estate market.
However, it's "ability to successfully compete in new segments across different geographies is yet to be demonstrated," ICRA said.
In a separate exercise, ICRA reaffirmed highest credit rating to Rs 500 crore short term debt of cement major ACC.
The rating factors in ACC's improved financial profile, its strong market position, pan-India presence and favourable demand and supply outlook for the domestic cement industry in the short term, ICRA said.
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