Fitch: Welspun outlook negative

Fitch Ratings said it revised Welspun Global Brands Ltd.'s outlook to negative from stable and affirmed its national long-term rating at A-(ind).

The negative outlook reflects the company's high financial leverage, exacerbated by the capacity expansion undertaken despite a recessionary environment in the end-user markets as well as margin risks due to volatility in cotton prices and forex risks, according to the agency.

The company's overall financial leverage rose to 7.3x in fiscal 2011 from 4.9x in fiscal 2010.

Ratings reflect the company's experienced management, well-diversified product portfolio, preferred global supplier status and its strong customer relationships, the agency said.

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