New Delhi, July 14: Credit rating agency ICRA today removed Mangalore Refinery and Petrochemicals from rating watch by upgrading the long term rating of the company, while assigning the highest safety 'A1+' rating to the Rs 300 crore commercial paper and short debt issue of MPRL. However, the credit rating agency noted the constraints for the ratings due to MPRL's exposure to volatile refining margins and prevailing over-supply position in the domestic markets.
"ICRA has upgraded the long term rating from LBBB to LA, indicating adequate safety, while removing it from rating watch (with positive implications)," it said in a statement. ICRA factored in the strategic importance of MRPL to Oil and Natural Gas Corporation, which is its main shareholder.
Besides, it also considered demonstrated financial and operational support rendered by ONGC and the satisfactory completion of MRPL's financial restructuring exercise. Following ONGC's acquisition of MRPL, which was set up as a joint venture between the AV Birla Group and Hindustan Petroleum Corporation, the company had been able to complete the financial restructuring, which resulted in "considerable" improvement in its capital structure and reduction in debt servicing commitments, ICRA said.
ICRA also withdrew the ratings assigned to commercial paper, non-convertible debenture and securitisation programmes of Subash Projects and Marketing, Jubilant Organosys and Karnataka State Financial Corporation Asset Management Trust respectively since these instruments were fully redeemed. Bureau Report