India's Gati falls nearly 13 pct as CARE cuts credit rating

Allcargo Gati

08/10/2018 06:20

Oct 8 (Reuters) - Shares of Gati Ltd  GATI.NS  fell nearly
13 percent to their lowest in more than a week on Monday, after
ratings agency CARE downgraded the logistics company's bank
facilities on Friday.
    CARE cut its rating on the company's long-term bank
facilities to BBB from A-, and downgraded short-term bank
facilities to A3+ from A2+, Gati said https://www.bseindia.com/xml-data/corpfiling/AttachLive/b6a9665c-bbcb-4b4f-8832-cc3e66570552.pdf.
    The revision in the ratings assigned to Gati's bank
facilities considers the decline in revenue from operations
along with "significant deterioration in PBILDT (profit before
interest, lease, depreciation and tax) level" and reduction in
gross cash accruals during FY18, the credit agency said in its
report.     
    Also, the company has raised additional debt during
financial year 2018 for redeeming part of its foreign currency
convertible bonds leading to higher debt repayment obligations
in FY19, while the cash accruals are expected to remain
relatively stressed, the report added. 
    The ratings, however, derive strength from the company's
experienced management, extensive support from subsidiary
companies for its e-commerce division and favourable industry
prospects. 
    More than 1.1 mln shares changed hands as of 0515 GMT,
compared with their 30-day average volume of 842,809 shares.
    Up to last close, Gati's stock has declined over 40 percent
this year.
    

 (Reporting by Sharnya G in Bengaluru; Editing by Rashmi Aich)
 ((Sharnya.G@thomsonreuters.com; +91 806749 1480; Reuters
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