Fitch cuts Pantaloon to F2+(ind)

Fitch Ratings said it affirmed Pantaloon Retail (India) Ltd.'s national long-term rating at A-(ind) and revised the outlook to negative from stable.

The agency downgraded the short-term debt instruments to F2+(ind) from F1(ind).

The action reflects the ongoing pressure on operating cash flows during the first half due to slowing same store sales growth, primarily in lifestyle retailing and to some extent in value retailing, according to the agency.

Ratings continue to reflect the company's strong market position in the domestic retail segment and a successful operating strategy, which has enabled the company to achieve industry-leading identical store sales trends and to generate cost efficiencies, the agency noted.

Ratings further reflect the company's presence across sub-segments within the retail industry, which reduces its dependence on a single format, Fitch said.

The issuer has a total adjusted debt-to-EBITDAR ratio at 8.5x in fiscal 2008.

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