India Ratings Upgrades Wockhardt to 'IND BBB-' / Outlook Stable, Off RWE

India Ratings and Research (Ind-Ra) has upgraded Wockhardt Limited's (WL) Long-Term Issuer Rating to 'INDBBB-' from 'INDBB+' while resolving the Rating Watch Evolving (RWE). The Outlook is Stable.

The resolution of the RWE reflects the completion of the partial divestment of WL's India formulations business, for which, the proceeds have been realised by the company. The upgrade reflects the i) improvement in WL's liquidity position post the part sale of its India business ii) the easing of repayment pressures during FY21 iii) continued strong promoter support as reflected in the funds infused during the difficult period of FY17 and FY18 and iv) visibilityon the refinancing available for FY22 though still not tied-up.

The added liquidity will help WL to payoff the debt due in FY21, extinguish preference shares and promoter loans, and invest in working capital. The ratings remain constrained due to a change in WL's business mix post the partial divestment of the higher-margin India business, which will restrict the scale of profitability improvement. Ind-Ra will continue to monitor the status on the operational improvement and WL's efforts to refinance the higher level of debt on its books.

Shares of WOCKHARDT LTD. was last trading in BSE at Rs.302.5 as compared to the previous close of Rs. 294.55. The total number of shares traded during the day was 26304 in over 1027 trades.

The stock hit an intraday high of Rs. 304.25 and intraday low of 296.15. The net turnover during the day was Rs. 7933593.

Source : Equity Bulls

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