Crisil reaffirms highest rating to Piramal Capital and Housing Finance for CP worth Rs 10,500 crore

Mumbai (Maharashtra) [India], July 15 (ANI): Rating agency Crisil has reaffirmed the highest rating A1+ to Piramal Capital and Housing Finance Ltd (PCHFL) for its commercial paper programme worth Rs 10,500 crore.
Crisil evaluated the business and financial risk profile of the overall financial services business and also factored the managerial and financial risk profile of the holding company Piramal Enterprises Ltd's (PEL) lending book.
"PCHFL welcomes these top-most ratings as it reaffirms the company's robust business portfolio, diversified revenue streams and established a presence across the spectrum of real estate financing along with increased product offerings," it said in a statement on Monday.
"Over the last nine months, in line with our efforts to improve the asset-liability profile, ever since the first signs of liquidity strain emerged in the Indian market, the company has raised funds of Rs 23,700 crore."
Crisil in its report said the company has put in place adequate credit appraisal, strong risk management and processes, which has supported the reported asset quality metrics. The management too has taken steps in order to reduce concentration risk in the portfolio with a focus on growing the individual housing loans portfolio.
"But what has really supported the asset quality metrics in the past has been the ability of the entity to get timely repayments and exits via refinancing. In fiscal 2019, in addition to a regular Rs 3,601 crore of collections, the group has also received prepayments to the tune of Rs 13,483 crore. For some of the loan accounts, the group has received prepayments covering the scheduled repayments over the next 12 to 24 months," it said.
The report stated that on a standalone basis, the resource profile for PCHFL is well diversified across instruments with bank and financial institutions loans at 61 per cent, non-convertible debentures constituting around 24 per cent and commercial papers at 16 per cent as on March 31.
"The management is also taking proactive steps to improve the resource profile mix through increasing long-term funding sources. The company has managed a sanction of Rs 1,050 crore of external commercial borrowings in the first quarter of fiscal 2020 and also plans to raise additional long term funds in the current fiscal, which would support the diversification into longer-term funding sources."
Crisil recently also assigned the highest rating A1+ to PEL for the short-term non-convertible debentures amounting to Rs 1,500 crore and the commercial paper programme amounting to Rs 12,000 crore by PEL. (ANI)