TTL's Rs 900cr-STD prog gets A1+ rating

New Delhi, Oct 17 (UNI) Credit rating agency ICRA today assigned an A1+ rating to the proposed short term debt (STD) issue of Tata Tea Ltd (TTL) for an amount upto Rs 900 crore.

This is the highest-credit-quality rating assigned by ICRA to short-term instruments. It has also retained the A1+ rating to the company's Rs 75 crore Commercial Paper Programme and taken the rating off rating watch.

The rating takes into account the company's position in the domestic packet tea market, growth achieved by its key brands, healthy profitability, conservative gearing levels, substantial investments with healthy valuations and its status as a leading company belonging to the Tata Group.

It also draws comfort from TTL's partial exit from plantation operations in South India, which has led to an improvement in the company's operating cost structure. The rating agency, however, notes that following the restructuring of the plantation business in North India, TTL's vulnerability to commodity swings in tea prices would increase.

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