Detailed Rationale

CRISIL Ratings has reaffirmed its ‘CRISIL AAA/Stable/CRISIL A1+’ ratings on the debt programmes and bank facilities of ABB India Limited (ABB India).

The ratings continue to reflect the company’s healthy market position, strong support from its ultimate holding company, ABB Ltd (rated ‘A-/Stable/A-2’ by S&P Global Ratings), and robust capital structure. These strengths are partially offset by susceptibility to intense competition and exposure to cyclicality in the industry.

In 2021, the company’s operating performance improved in terms of total operating income and operating margins and is expected to recover further over the medium term, with healthy growth prospects across the company’s diverse business segments, as reflected in orders worth Rs 7666 crore as on Dec 31, 2021. For the six months ended June 30, 2022, the company reported profit after tax (PAT) of Rs 513 crore and operating income of Rs 4,021 crore. Furthermore, the financial risk profile remains strong, as reflected in the absence of any debt obligation and cash balance of around Rs 3,000 crore as on Oct 12, 2022.

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