Fitch Ratings affirms rating of Essar Oil’s bank facilities

Credit rating agency, Fitch Ratings has affirmed Essar Oil’s national long-term bank facilities rating at BBB-(ind) with stable outlook. The rating agency has also affirmed the company’s Rs 5,333.00 crore term loans (enhanced from Rs 4,200 crore) rating at BBB-(ind) and rating of $100 million external commercial borrowings of the company at BBB-(ind).

The affirmation reflects Fitch’s expectation of an improvement in the company’s credit metrics in the medium-term. The agency notes that under the phase I capacity expansion, the commissioning of train 1 (increasing capacity up to 16 million tonne per annum) has been delayed by two quarters to September 2011.

Essar Oil registered a growth of 2155.17% in its net profit at Rs 654.00 crore whereas the same was at Rs 29.00 crore for the year ended March 31, 2010. Its total income has also grown by 28.69% at Rs 47,248.00 crore for the year under review whereas the same was at Rs 36,716.00 crore for the previous year.