Fitch rates Mountain Spinning loans BB-(ind)

Fitch Ratings said it assigned Mountain Spinning Mills Ltd. a national long-term rating of BB-(ind), along with its Rs. 182 million term loans of BB-(ind), Rs. 120 million fund-based working capital limits of BB-(ind) and Rs. 28 million non-fund-based working capital limits of F4(ind).

The outlook is stable.

The ratings reflect the inherent risk of operating in a commodity market that is characterized by volatile raw material prices and competitive pressures on the pricing of yarn, Fitch said.

The ratings are constrained by the power shortage in the state of Tamil Nadu, necessitating diesel power generation at high cost and the downturn in the Indian textile industry, the agency said.

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