Credit rating agency, CARE has assigned ‘CARE AA- (SO)’ rating to the proposed Non Convertible Debentures (NCD) issue Series II of Mysore Paper Mills (MPM) for Rs 50.00 crore. The rating is however constrained by the relatively low level of capex, the lacunae in revenue-collection efficiency and slippages witnessed in cash balance management.
The series will carry a coupon rate of 8.49% per annum, payable semi-annually and redeemed in equal installments at the end of 7th, 8th, 9th and 10th year from the date of allotment. The tripartite agreement amongst MPM, Government of Karnataka and trustees to the NCD issue has been executed on March 29, 2011.
Mysore Paper Mills was founded in May 1936 by the Maharaja of the erstwhile State of Mysore. MPM became a government company in November 1977, when Government of Karnataka (GoK) acquired a controlling interest in the company. As on March 31, 2010, GoK held a 64.7% stake in MPM, the remainder is held by financial institutions and the general public.
| Company Name | CMP |
|---|---|
| JK Paper | 375.20 |
| TN Newsprints | 140.05 |
| West Coast Paper | 492.00 |
| Emami Paper Mills | 75.24 |
| Seshasayee Paper | 270.95 |
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