Ess Dee Aluminium shares dip as rating agency downgrades debt

Ess Dee Aluminium has dipped 16% to INR 216 on the BSE after rating agency CARE downgraded the company’s debt.

“CARE has revised rating assigned to bank facilities of Ess Dee Aluminium. The ratings for fund-based long term bank facilities worth INR 180 crore and long term non-convertible debentures of INR 30 crore to D from BBB- each,” the rating agency said in a release dated January 6, 2016. It also revised rating for non-fund-based short term bank facilities worth INR 335 crore to D from A3.

The rating agency said the revision in the ratings of Ess Dee Aluminium Limited takes in to account the ongoing delays in debt servicing owing to the strained liquidity position.

Since November 9, 2015 the stock declined 33% from INR 323 after the company reported consolidated net loss of INR 15.44 crore for the quarter ended September 2015. It had profit of INR 14.10 crore in the same quarter previous year. Net sales declined by 40% to INR 133 crore over the previous year quarter. The S&P BSE Sensex was down 4.5% during the same period.

Ess Dee Aluminium is engaged in manufacturing of aluminium foil based high-end packaging solutions for pharmaceuticals, FMCG and confectionery industry.

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