Fitch affirms Shyam Telecom

Fitch Ratings said it affirmed Shyam Telecom Ltd.'s national long-term rating at BBB-(ind), along with its fund-based working capital limits of Rs. 80 million at BBB-(ind) and the long- and short-term ratings of its non-fund based working capital limits of Rs. 1.16 billion) at BBB-(ind) and F3(ind), respectively.

The outlook has been revised to negative from stable.

The negative outlook reflects an expectation that the revenue and profitability of the company would remain under pressure during the short to medium-term, Fitch said.

The company expected substantial benefits from national network roll-out of its sister company, Sistema Shyam Teleservices Ltd., to accrue in the next six to eight months, the agency said. Without these benefits, the company's financial leverage could remain above 4x and would lead to a downgrade, Fitch said.

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