CRISIL place Hindalco Industries Ratings on "Watch with Negative Implications"

Hindalco Industries Ltd has announced that CRISIL has placed its rating on the Company's outstanding long-term rating of AAA/Stable on 'Rating Watch with Negative Implications'.

- Non-Convertible Debentures Programmes: AAA (Rating Watch with Negative implications) (aggregating Rs 15.94 Billion)

- Rs 0.25 Billion Short Term Debt Programme: P1+ (Reaffirmed)

The rating action follows the Company's offer to buy 100 per cent of the equity of Novelis Inc., for an overall consideration of USD 6 billion. The proposed acquisition cost is significantly larger than the Company's net worth of about Rs 95 billion (as at March 31, 2006). The Company is proposing to fund this acquisition primarily through debt which will have an adverse impact on the capital structure of the Company.

Source : Equity Bulls

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