New Delhi, June 30: Credit rating agency ICRA today reaffirmed the highest safety 'A1' rating to the enhanced commercial paper and short term debt of Rs 15 crore of Sono Koyo Steering Systems (SKSS). The rating factored in the company's established position as a leading vendor of steering systems in the domestic passenger car industry, improved profitability arising from increased localisation of power steering components and the conservative capital structure, ICRA said in a statement here.

However, increased competition from original equipment manufacturers like Maruti was likely to sustain pressure on the company's realisations, the credit rating agency added. "SKSS's efforts to cut costs is thus expected to be a critical determinant for future improvement in the company's profitability," ICRA said.

SKSS is the market leader in Indian passenger car drive transmission industry, while its technical collaborator Koyo Seiko company of Japan is the second largest player in the world. Bureau Report