Fitch affirms low default risk on Usha Martin

NEW DELHI: Ratings agency Fitch today affirmed a low default risk on steel wire rope manufacturing giant Usha Martin with a stable outlook on the back of the company's good Ebidta margin and credit position.

" Fitch Ratings has affirmed India-based Usha Martin Ltd's national long-term rating at 'A+(ind)' with a stable outlook. The ratings reflect its stable consolidated Ebidta margin and comfortable credit metrics over the last two years," Fitch said in a statement.

An 'A' national rating denote expectations of low default risk relative to other issuers or obligations in the same country.

"The ratings also draw comfort from the company's low exposure to volatile raw material (primarily low-ash metallurgical coke) prices and better inventory management as it owns captive iron ore and coal mines," Fitch said.

During the 2010-11 financial year, Usha Martin reported a consolidated Ebidta margin of 18.8 per cent and Fitch said it was on account of the company's integrated operations and value-added product profile.

Usha Marin had reported a a revenue of Rs 2,567 crore during the last fiscal, up 36 per cent from the figure of Rs 1,850 crore in 2009-10.

Usha Martin is a major manufacturers of wire rods, bright bars, steel wires, speciality wires, wire ropes, strand, conveyor cord, wire drawing and cable machinery.