Fitch lowers Puravankara Projects short-term debt

Fitch Ratings said it affirmed the national long-term rating on Rs. 5 billion of Puravankara Projects Ltd.'s debt at A-(ind) and downgraded the national short-term rating on Rs. 750 million of debt to F2+(ind) from F1(ind).

The outlook is stable.

The agency said the downgrade reflects the refinancing risk associated with Puravankara Projects' debt obligations given the slowing demand and growing liquidity constraints facing India's real estate sector. Of its total debt of Rs. 6.5 billion, 48% is repayable during the current year.

Fitch noted, however, that Puravankara Projects has maintained moderate financial leverage compared to its peers and is in a better position to manage the sector's slowdown. The agency also draws comfort from the company's strategic move into lower-cost housing.

The total debt-to-EBIDTA ratio is 3.1 times.

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