Fitch rates PEC loans A(ind), F1(ind)

Fitch Ratings said it assigned a national long-term issuer rating of A(ind) to PEC Ltd., and to its bank loans an A(ind) national long-term rating to the fund-based long-term (cash credit) bank lines aggregating Rs.1.02 billion, F1(ind) national short-term rating to the fund-based working capital banking lines aggregating Rs.8.9 billion and F1(ind) national short-term rating to the non fund-based working capital banking lines of Rs.39.75 billion.

The outlook is stable.

The ratings reflect the back-to-back transaction-based business model that the company operates in, Fitch said, and the low financial leverage PEC has been able to maintain.

The ratings are moderated by a decline of the state-owned enterprise's share in Indian foreign trade, stringent government regulatory norms and low, sustained EBITDA margins due to strong competition that it faces from other government and private players, the agency said.

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