Fitch rates Power Spinning Mills B+

Fitch Ratings said it assigned Power Spinning Mills a B+(ind) national long-term rating, along with B+(ind)/F4(ind) ratings to its Rs. 30 million fund-based working capital limits and Rs. 20 million non-fund based working capital limits, as well as a B+(ind) to its Rs. 49.16 million term loans.

The outlook is stable.

The ratings reflect the small size of the company's operations and its limited seven-year track record, Fitch said.

Fitch noted the inherent risk of operating in a commodity market characterized by the volatility in cotton prices, coupled with competitive pressures on pricing in the yarn market.

The ratings also are constrained by India's cotton yarn spinning industry's gradual recovery path following the global downturn and the power shortage in the state of Tamil Nadu, the agency said.

The company's ratings draw strength from its high capacity utilization and modernized spinning facility with power-saving machinery, Fitch said.

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