Fitch cuts Parsynath Developers to D

Fitch Ratings said it downgraded Parsvnath Developers Ltd.'s national long-term rating to D from BB-(ind) to reflect the company's coercive debt exchange. The agency also said it reassigned the company a B-(ind) national long-term rating to reflect its post-restructuring credit profile. Other downgrades include Rs.2 billion long-term debt and Rs.9 billion term-bank loan to D from BB-(ind) and reassigned at B-(ind); and Rs.2 billion short-term debt to F5(ind) from F4(ind) and reassigned at F4(ind). The rating watch negative has been resolved.

The outlook is negative.

The downgrade reflects the company's financial restructuring with banks, Fitch said. The agency said the restructuring has not resulted in significant impairment of the contractual terms for the creditors, but was essential for the company to avoid a liquidity crunch and would have otherwise resulted in a default on its debt obligations.

Liquidity risk continues as the company has substantial repayments ahead, the agency said.

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