The Bombay Dyeing and Manufacturing Company Ltd
By 14 January 2000 | 14 Jan 2000
- Commercial
paper programme - Rs. 200 crore
Rating : P1+ (reaffirmed) - Non-convertible
debenture - Rs. 83 crore
Rating : AA to A+ (downgraded) - Secured
premium notes issue - Rs. 17.2 crore
Rating : AA to A+ (downgraded)
Crisil has downgraded its rating for the Rs. 83-crore non-convertible debenture issue and Rs.17.2 crore secured premium notes issue of The Bombay Dyeing and Manufacturing Company Ltd from ‘AA’ to ‘A+’. It has, however, reaffirmed its ‘P1+’ rating assigned to the company's Rs. 200-crore commercial paper programme.
The revision
in long term ratings factor in the continued weak performance
of Bombay Dyeing's textiles operations primarily on account
of an unfavourable cost structure, volatility in profitability
of the DMT (di-methyl terephthalate) division, high degree
of competition in the textiles and DMT business, and low
level of profitability. The ratings are supported by the
company’s strong market position in the textiles
business (primarily in the home furnishings segment),
established retail distribution network, and significant
financial flexibility arising out of the large liquid
assets available with the company.
Bombay Dyeing is engaged in the manufacture and sale of cotton and blended fabrics (shirtings, suitings, apparel, home furnishings, ready-made garments, and industrial fabrics) and DMT. During the year 1998-99, the textile division contributed around 62% of the company's total turnover (of Rs. 8.6 billion), with the balance being contributed by the company’s DMT operations.