Fitch affirms Motherson Auto

Fitch Ratings said it affirmed Motherson Auto Ltd.'s national long-term rating at BBB-(ind).

The outlook is stable.

The ratings benefit from the company's highly predictable cash flows due to its captive group client base and consistently high EBIDTAR margins as the company is into service business, according to the agency.

The company's ratio of net adjusted debt to operating EBIDTAR rose to 9.8 times in fiscal 2011 from 7.1x in fiscal 2010 due to higher borrowings and is likely to remain high during fiscal 2012, Fitch noted.

The ratings are constrained by the company's small size of operations, consistently high leverage due to the nature of its business and low interest coverage ratio, the agency said.

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