August 08, 2012

Mumbai

OCL Iron & Steel Limited

Ratings Suspended

Total Bank Loan Facilities Rated
Rs. 500 Million
Long-Term Rating
Suspended
Short-Term Rating
Suspended

(Refer to Annexure 1 for details on facilities)

CRISIL has suspended its rating on the bank facilities of OCL Iron & Steel Ltd. (OCL Steel). The suspension of ratings is on account of non-cooperation by OCL Steel with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, OCL Steel is yet to provide adequate information to enable CRISIL to assess OCL Steel’s ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL views information availability risk as a key credit factor in its rating process and views non-sharing of information as a first signal of possible credit distress, as outlined in its criteria “Information availability risk in Credit ratings".

About the Company

Incorporated in February 2006 as a public limited company, OCL Steel was a wholly owned subsidiary of OCL India Ltd (OCL India), a company belonging to the Dalmia group. In January 2007, the assets and liabilities of OCL India’s steel undertaking were vested in OCL Steel. The company currently has an installed capacity to produce 120,000 tonnes per annum (tpa) of sponge iron and 85,000 tpa of billets; it also has a 14-megawatt (MW) power plant.

Annexure 1 - Details of various bank facilities

Current facilities
Previous facilities
Facility
Amount
(Mln)
Rating
Facility
Amount (Mln)
Rating
Cash Credit
300
Suspended
Cash Credit
320
CRISIL BBB- (Continues on ‘Rating Watch
with Developing Implications’)
Letter of credit & Bank Guarantee
80
Suspended
Letter of credit & Bank Guarantee
80
CRISIL A3 (Continues on ‘Rating Watch
with Developing Implications’)
Packing Credit
100
Suspended
Packing Credit
100
CRISIL A3 (Continues on ‘Rating Watch
with Developing Implications’)
Proposed Cash Credit Limit
20
Suspended
--
0
--
Total
500
--
Total
500
--

Media Contacts
Analytical Contacts
CRISIL Rating Desk
Mitu Samar
Director, Communications and Brand Management
CRISIL Limited
Tel: +91-22- 3342 1838
E-mail: mitu.samar@crisil.com

Tanuja Abhinandan
Communications and Brand Management
CRISIL Limited
Tel: +91-22- 3342 1818
Email: tanuja.abhinandan@crisil.com
Subodh K Rai
Senior Director - CRISIL Ratings
Tel: +91-0124-672 2000
Email: subodh.rai@crisil.com

Mohit Makhija
Director - CRISIL Ratings
Tel: +91-0124-672 2000
Email: mohit.makhija@crisil.com

Tel: +91-22-3342 3047/3342 3064
Email:CRISILratingdesk@crisil.com

Note:
This rating rationale is transmitted to you for the sole purpose of dissemination through your newspaper / magazine / agency. The rating rationale may be used by you in full or in part without changing the meaning or context thereof but with due credit to CRISIL. However, CRISIL alone has the sole right of distribution of its rationales for consideration or otherwise through any media including websites, portals etc.

Crisil complexity levels are assigned to various types of financial instruments. The crisil complexity levels are available on www.crisil.com/complexity-levels.investors are advised to refer to the crisil complexity levels for instruments that they desire to invest in. Investors may also call the crisil helpline at +91 22 3342 3047 / + 91 22 3342 3064 with queries on specific instruments.


About CRISIL LIMITED
CRISIL is a global analytical company providing ratings, research, and risk and policy advisory services. We are India's leading ratings agency. We are also the foremost provider of high-end research to the world's largest banks and leading corporations.

CRISIL PRIVACY NOTICE
CRISIL respects your privacy. We use your contact information, such as your name, address, and email id, to fulfill your request and service your account and to provide you with additional information from CRISIL and other parts of The McGraw-Hill Companies, Inc. you may find of interest.
For further information, or to let us know your preferences with respect to receiving marketing materials, please visit www.crisil.com/privacy. You can view McGraw-Hill's Customer Privacy Policy at http://www.mcgraw-hill.com/site/tools/privacy/privacy_english.
Last updated: April 30, 2012

Disclaimer: A CRISIL rating reflects CRISIL's current opinion on the likelihood of timely payment of the obligations under the rated instrument and does not constitute an audit of the rated entity by CRISIL. CRISIL ratings are based on information provided by the issuer or obtained by CRISIL from sources it considers reliable. CRISIL does not guarantee the completeness or accuracy of the information on which the rating is based. A CRISIL rating is not a recommendation to buy, sell, or hold the rated instrument; it does not comment on the market price or suitability for a particular investor. All CRISIL ratings are under surveillance. Ratings are revised as and when circumstances so warrant. CRISIL is not responsible for any errors and especially states that it has no financial liability whatsoever to the subscribers / users / transmitters / distributors of this product. CRISIL Ratings rating criteria are available without charge to the public on the CRISIL web site, www.crisil.com. For the latest rating information on any instrument of any company rated by CRISIL, please contact CRISIL RATING DESK at CRISILratingdesk@crisil.com, or at (+91 22) 3342 3000.


August 08, 2012

http://www.crisil.com