Hero Cycles Ltd.
By 1 December 1999 | 01 Dec 1999
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Non-convertible debentures - Rs. 20 crore Rating : AA+
Crisil has assigned an "AA+" (pronounced double-A plus) rating to the proposed Rs. 20-crore non-convertible debenture programme of Hero Cycles Ltd.
The rating takes into consideration Hero Cycles' continued improvement in business risk subsequent to the stabilisation of the cold rolled project and continued improvement in financial risk profile as reflected by key ratios like gearing, coverage etc. The financial risk profile is expected to remain comfortable due to continuous cash inflows with no corresponding major expansion/ investments in hand.
The rating also factors in HCL’s strong business profile in terms of brand name, leading market position in the bicycle industry, superior operating efficiency and working capital management. The rating is offset mainly by the inherently low profitability and growth rates in the bicycles business, a modest position in the cold rolled steel business and support extended to other companies in the Hero Group.