Tata SSL Ltd

• Non convertable debenture - Rs. 26.42 crore Rating : A- (reaffirmed)

The ‘A-’ (pronounced single A minus) rating assigned to the Rs. 264.2 mn debenture issue of Tata SSL Limited has been reaffirmed.

The rating reflects the strong market position of the company’s profitable wires division and high financial flexibility associated with being a Tata group company. This is offset by the loss making narrow width flat products business that drags down the company''s profitability, the susceptibility of margins in the wires business to fluctuations in raw material costs and increase in power tariffs, and the relatively weak financial profile of the company.

Tata SSL has two main lines of business viz. manufacture and sale of wires and wire rods, and cold rolling of HR coils into narrow width CR coils. The company also commissioned a small profiles division in 1997-98. The wires division is expected to account for over 85% of future sales in the medium term. The company declared a net profit of Rs. 22.2 mn on sales of Rs. 4.75 billion in the period Apr-Dec 1999.