• Commercial paper programme - Rs. 30 crore Rating : P1+
• Non-convertible debentures - Rs. 5 crore Rating : AA- (reaffirmed)

Crisil has assigned a ‘P1+’ rating to Essel Packaging Ltd''s enhanced Rs. 30-crore commercial paper programme. It has also reaffirmed its ‘AA-’ rating for the company''s Rs.  5-crore non-convertible debenture issue.

The ratings reflect Essel Packaging''s strong market position in the lamitube packaging business, expected growth of the lamitube market in India over the next couple of years, and the stable operations of the company. The rating also factors in its moderate gearing and comfortable interest coverage ratios. This is partially offset by the company''s dependence on imported raw materials and its financial support, though gradually declining, to group companies.

Essel Packaging, an Essel group company, makes multi-layer collapsible tubes (lamitubes). It is at present the largest manufacturer of this product in India, and among the largest manufacturers in the world. The company reported net sales of Rs.151.38 crore and a net profit of Rs.26 crore in 1998-99.