Fitch rates Mahindra Ugine Steel

Fitch Ratings said it assigned a national issuer rating of A-(ind) to Mahindra Ugine Steel Company Ltd., along with a national long-term rating of A-(ind) to its long-term fund-based limits of Rs.1,476 million , A-(ind)/F1(ind) to the company's cash credit/working capital demand loan and short-term loan limits of Rs.1,400 million and an F1(ind) ratings to the short-term non-fund-based limits of Rs.2,200 million.

The outlook is stable.

The ratings reflect the value-added nature of the company's product profile, supported by a growing demand from the automotive and engineering sector coupled with steady improvements in its financial profile over the past four years, Fitch said.

The key concerns for the rating include its status as an intermediate player with limited control on raw materials, the agency said, and limited bargaining power to pass on the cost increases to its end-users.

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