Credit rating agency, CARE has revised the assigned rating to the long-term bank facilities of Tamilnadu Petroproducts (TPL). The agency has revised the rating from ‘BBB’ to ‘BBB+’ for Rs 120.02 crore. The agency has also revised the assigned rating ‘BBB/ A3’ to ‘BBB+/ A3+’ to the short-term bank facilities of the company for Rs 83.95 crore.
The revision in the ratings reflects the improved operational performance of TPL during FY11 and improved liquidity position on account of divestment of stake in Henkel India. The ability of the company to sustain the improvement in operational performance and improve profitability margins in a scenario of increasing raw material prices and dismal power situation, company refraining from taking any major debt funded expansion and absence of fresh investments in subsidiaries/ group companies would be key rating sensitivities.
Tamilnadu Petroproducts (TPL) is a joint venture between SPIC and Tamilnadu Industrial Development Corporation (TIDCO). TPL is one of the leading Indian manufacturers of Linear Alkyl Benzene (LAB) with a production capacity of 120,000 MTPA. TPL also has facilities to manufacture 10,000 TPA of Epichlorohydrine (ECH) apart from caustic soda (56,100 MTPA) and chlorine (40,000 MTPA).