The agency has also affirmed the company's short-term rating at 'IND A1+'. India Ratings and Research stated that the affirmation reflects a sustained improvement in SSWL's revenue and credit metrics over FY20-FY24, a resilient operating profitability, range-bound EBITDA margins, a reduction in promoter's shares pledge to 'nil' as of September 2024 from 4.92% in September 2023 and an increased share of higher-margin business (alloy wheels) in the revenue, leading to a significant improvement in its business profile. The agency further said that a significant and sustained improvement in the revenue and profitability, maintaining increased proportion of higher margin businesses along with a reduction in the working capital cycle, maintaining a positive free cash flow while reducing the adjusted net leverage below 1.5x, all on a sustained basis, could lead to a positive rating action. However, a decline in the revenue or profitability, a stretch in the working capital cycle, or a decline in the liquidity cushion, or any large debt-funded organic or inorganic capex, leading to the adjusted net leverage remaining above 2.5x, all on a sustained basis, could lead to a negative rating action. Steel Strips Wheels manufactures steel wheel rims in the range of 10-to-30-inch diameter for PVs, utility vehicles, tractors, trucks, two wheelers, among others. The scrip shed 0.52% to currently trade at Rs 209.50 on the BSE. Powered by Capital Market - Live News |