Credit rating agency, CARE has assigned ‘AA+’ rating to the Non Convertible Debentures (NCDs) issue for Rs 250 crore of the Indian Hotels Company (IHCL). Ability of IHCL to achieve stabilization of operations of overseas subsidiaries is the key rating sensitivity.
The rating reflects IHCL’s dominant position along with diversified presence in the Indian hospitality sector, strong brand image, proven track record of management, strength of association with the Tata Group, revival in the hospitality industry and favourable capital structure. The rating is however tempered by risks arising from the expansion and investment plans across geographies and the inherent cyclical nature of the hotel industry.
IHCL is promoted by the Tata Group. It has long-standing operations spanning over 100 years and operates the largest hotel chain in South Asia. IHCL, its subsidiaries and associates are widely recognized under the umbrella brand name ‘Taj Hotels Resorts and Palaces’, which has 107 hotels with a room inventory of 12,795 rooms as on March 31, 2011. The group also has presence in air catering, spas, wildlife lodges and service apartments.
