Consolidated Construction Consortium Ltd has informed BSE that ICRA has assigned “A1+” (pronounced as A One plus) racing indicating highest-credit-quality to the Rs 1.79 billion short-term Fund-Based / Non Fund-Based limits and “LA+” (pronounced as L A plus) rating indicating adequate-credit-quality to the Rs 5.85 billion long-term Fund-Based / Non Fund-Based limits of Consolidated Construction Consortium Ltd (CCCL), ‘+’ sign appended to the ratings indicate their relative position within the rating categories concerned.

The rating factors in CCCL’s experienced management; its strong project monitoring systems and its successful execution track record in the construction industry. The rating also takes into consideration improvement in financial risk profile of the Company post its Initial Public Offer (IPO) as reflected in decline in its gearing level from 0.62 times as on March 31, 2007 to 0.20 times as on December 31, 2007. The rating is however constrained by the challenges involved for the Company in scaling up resources given the increase in the level of activities and its high working capital intensity which constraints its cash flows from operations. Moreover, CCCL’s activities are limited primarily to construction of buildings and structures in the commercial, industrial and infrastructural sectors, in which the operating margins and profitability could be more vulnerable to competitive pressures. Nevertheless, ICRA expects the Company to post healthy growth in top-line and profits because of its strong order-book, its demonstrated execution track record and favourable prospects for the construction industry. This along with low debt repayment obligation would lead to adequate debt protection indicators in the long term.