CARE assigns ‘AA-’, ‘PR1+’ to Texmaco

MUMBAI: CARE has assigned ���CARE AA-��� rating to the long/medium term bank facilities and ���PR1+��� rating to the short-term bank facilities of Texmaco Ltd. The ratings are for bank facilities aggregating Rs.1,328.9 crore.

The ratings draw strength from long & satisfactory track record of the company, experience of the promoters, leadership position in the domestic wagon segment, satisfactory order book position, improving profitability, comfortable financial position with low overall gearing & high interest coverage, sizeable real estate properties in prime areas providing cushion in times of stress and rising demand for commodity specific wagons among private players.

The long term rating is however, constrained by low capacity utilisation for hydro-power equipment, intense competition in all the product segments, volatility in the wagon business, significant dependence on Indian Railways for wagon business and risks associated with projects under implementation. Successful commissioning of the ongoing projects and sustainability of the order position in the context of current economic slowdown will remain the key rating sensitivities.