Fitch Ratings | Press Release

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Correction: Fitch Affirms IVRCL at 'A+(ind)'; Outlook Stable

15 Jul 2011 6:10 AM (EDT)

Ratings

Fitch Ratings-Chennai/Singapore-15 July 2011: This announcement corrects the version issued on 19 April 2011, which incorrectly stated the issuer's non-fund based limits. An amended version follows: Fitch Ratings has affirmed India-based IVRCL Limited's (IVRCL - formerly IVRCL Infrastructure & Projects Ltd) National Long-Term rating at 'A+(ind)'. The Outlook is Stable. Fitch has also taken the following rating actions on IVRCL's limits: - INR10bn consortium fund-based limits (enhanced from INR7.8bn): 'A+(ind)'; - INR6.2bn project-specific fund-based limits: 'A+(ind)'; - INR1.34bn long-term loans: affirmed at 'A+(ind)'; - INR3.2bn non-convertible debenture programme: affirmed at 'A+(ind)' ; - INR7.5bn commercial paper programme: affirmed at 'F1+(ind)'; - INR52bn consortium non-fund based limits (increased from INR36bn): affirmed at 'A+(ind)' and assigned 'F1+(ind)'; - INR11.06bn project-specific non-fund based limits: affirmed at 'F1+(ind)' and assigned 'A+(ind)'; The commercial paper programme will be carved out of the existing fund-based working capital limits. IVRCL's ratings continue to reflect its strong competitive market position, long operating track record, and strong order book position. As of end-December 2010 (9MFY11), the company had an order book position of INR242bn (4.4x of FY10 revenues), which provides strong revenue visibility. Fitch notes that the company has transferred its entire build-operate-transfer (BOT)/build-own-operate-transfer (BOOT) portfolio to its subsidiary, IVRCL Assets & Holdings Limited (IVRCL Assets), which would need to support the equity contribution requirement of the portfolio. The agency also notes that IVRCL Assets will meet such funds requirement by raising equity through qualified institutional placement and monetisation of land bank holdings, and IVRCL would not extend any further support through equity or corporate guarantees. Any increase in the company's net adjusted debt/EBITDA to above 5x on a sustained basis will lead to a negative rating action. A significant improvement in leverage will lead to a positive rating action. In FY10, the company reported revenues of INR54.92bn (FY09: INR48.82bn), operating EBIDTA of INR5.31bn (FY09: INR4.22bn) and net profit of INR2.1bn (FY09: 2.25bn) on a standalone basis. As at FYE10, the company had an adjusted debt/EBITDA of 4x (FYE09: 3.8x) and interest coverage of 2.5x (FYE09: 2.2x). Its adjusted debt comprises balance sheet debt and corporate guarantees given. In 9MFY11, the company reported revenues of INR35.99bn, EBITDA of INR3.37bn and net profit of INR936m. Contacts: Primary Analyst Vinay Betala Analyst +91 44 4340 1719 Fitch Ratings India Pvt Ltd 4th Floor, D South, Tidel Park No. 4, Rajeev Gandhi Salai Taramani, Chennai 600 113 Secondary Analyst Sudha Sundaram Analyst +91 44 4340 1705 Committee Chairperson Rakesh Valecha Senior Director +91 22 4000 1740

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Fitch Ratings | Press Release

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Media Relations: Bindu Menon, Mumbai, Tel: + 91 22 4000 1727, Email: bindu.menon@fitchratings.com; Shivani Sundralingam, Singapore, Tel: + 65 6796 7215, Email: shivani.sundralingam@fitchratings.com. Note to Editors: Fitch's National ratings provide a relative measure of creditworthiness for rated entities in countries with relatively low international sovereign ratings and where there is demand for such ratings. National ratings are designed for use mainly by local investors in local markets and are signified by the addition of an identifier for the country concerned, such as 'AAA(ind)' for National ratings in India. Specific letter grades are not therefore internationally comparable. Additional information is available at www.fitchratings.com. Applicable criteria, 'Corporate Rating Methodology', dated 13 August 2010, are available at www.fitchratings.com. Applicable Criteria and Related Research: Corporate Rating Methodology - Amended ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

Copyright 2011 by Fitch, Inc., Fitch Ratings Ltd. and its subsidiaries.

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