Allied Domecq Spirits and Wines (India) Pvt. Limited

• Commercial paper programme - Rs 9.5 crore Rating : P1 (reaffirmed)

The 'P1' (pronounced P one) rating assigned to the Rs 9.5 crore Commercial Paper programme of Allied Domecq Spirits and Wines (India) Pvt. Limited (ADSW) has been reaffirmed. The rating factors in the change in the risk profile of its key promoter, Allied Domecq PLC, UK on account of the sale of its pub retail business as evidenced by the downward revision of its rating from A to A- by Standard and Poors.

The rating continues to factor in the managerial, technical and financial support extended to the venture by Allied Domecq PLC, UK. However the rating is constrained by the regulatory risks present in the business and the limited track record of the company. While CRISIL expects Allied Domecq PLC, UK (ADLPU) to maintain its shareholding at the existing level, regulatory risks may hinder the ability of Allied Domecq PLC to increase its stake in the venture from the current level of 50 per cent.

ADSW is a Joint venture between Allied Domecq PLC and an NRI group, the Khannas. Both partners enjoy a fifty-fifty shareholding in the venture. The venture is engaged in the manufacture of Bottled in India Scotch (BIIS), IMFL and grain based alcohol. The company had net sales turnover of Rs 353.6 million and net loss of Rs 18.1 million for the year ended August 31, 1999 (unaudited figures).