Credit Rating updates
PML · price
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Awaiting price reaction for this filing.
Paul Merchants Ltd has informed the stock exchanges that Infomerics Valuation and Rating has downgraded its credit ratings across all banking facilities totalling INR 31.75 crore. The fund-based working capital facility of INR 18 crore was cut from IVR A-/Negative to IVR BBB+/Negative, the bank guarantee facility of INR 2 crore from IVR A2+ to IVR A3+, and proposed long/short term loans of INR 11.75 crore received a similar downgrade. The rating agency cited a sustained deterioration in earnings over the last four quarters, driven by lower forex income due to reduced migration of students and workers to Canada and Europe. Geopolitical tensions and policy changes aimed at tackling unemployment in these regions were also flagged as risks to near-term recovery. The agency noted that the promoters' industry experience and a comfortable capital structure continue to provide some comfort.
This downgrade signals weakening business fundamentals and may increase the company's future borrowing costs, while also weighing negatively on investor sentiment in the short term.