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ICRA assigns LAA rating to Rs 150cr NCD prof of CDFL

Written by: Staff
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New Delhi, July 5 (UNI) Credit rating agency ICRA has assigned an LAA rating to the Rs 150 crore Non Convertible Debenture (NCD) programme of Cholamandalam DBS Finance Ltd (CDFL).

The new rating of LAA does not signify a relative shift in the company's credit quality. The outstanding medium term NCDs of CDFL and the Fixed Deposits have been reaffirmed at MAA+ carrying a positive outlook.

As per ICRA's policy, fresh NCDs with tenures greater than 1 year will be rated on the long-term scale.

The ratings factor in CDFL's increased focus in the commercial vehicle (CV) markets, its good asset quality in this segment, moderate leverage and capitalisation on account of recent equity infusions, its financial flexibility on account of a diversified funding and its experienced and competent management.

The ratings also take note of the pressure on CDFL's yields in the current climate of rising interest rates and the recent steps initiated by the management to enter into higher yielding segments such as sub-prime CV lending and personal loans.

CDFL, a non-banking finance company is having total assets of Rs 2098 crore as on March 31, 2006.

UNI DKS RA PC1759

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