Birla Cable Limited has informed the Exchange about Credit Rating- Revision
BIRLACABLE · price
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CARE Ratings has taken dual rating actions on Birla Cable Limited. For ₹55 crore long-term bank facilities, the rating at 'CARE BBB+/CARE A2' was reaffirmed and placed on 'Rating Watch with Positive Implications' linked to the proposed merger with parent Vindhya Telelinks Limited (VTL). However, ratings for ₹120 crore long-term bank facilities were downgraded to 'CARE A (CE)' from 'CARE A+ (CE)', and ₹176 crore short-term bank facilities downgraded to 'CARE A1 (CE)' from 'CARE A1+ (CE)', both placed on 'Rating Watch with Developing Implications'. The downgrades reflect pressure on the parent VTL, whose ratings were also downgraded due to moderate operations in 9MFY26, execution delays in EPC contracts (particularly under Jal Jeevan Mission), higher working capital borrowings, and deteriorating debt metrics with interest coverage declining to 1.37x in 9MFY26 from 3.38x in FY25.
The mixed rating action shows near-term credit stress from working capital pressures and EPC execution delays, but the positive watch on the ₹55 crore facility signals potential improvement upon merger completion. Shareholders should note the rating downgrades signal elevated credit risk, though the eventual merger with VTL could stabilise the credit profile if regulatory approvals are secured within the expected 10-12 month timeline.