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Fitch Ratings has assigned India-based HPCL Mittal Pipelines Ltd's Rs 1,000 crore non-convertible debenture programme a national long-term rating of 'Fitch AA-(ind)'.
These debentures are secured with a 4 per cent coupon rate and a significant premium on maturity. The proceeds shall be used to prepay the existing rupee term loans thus prevent interest outgo and alleviate liquidity pressure during the initial years of commercial operations.
HMPL's ratings have been equalised with that of HPCL Mittal Energy's ('Fitch AA-(ind)'/Stable) to reflect the strong operational and strategic linkages between the two entities. The ratings also reflect the successful commissioning of HMPL's pipeline network for crude oil transportation and HMEL's refinery in June 2011 and September 2011, respectively, within expected time frame and without significant cost overruns.
HMPL had incurred total capex of Rs 40.8 billion till FY12 (year end March) towards the construction of a crude oil receipt terminal at Mundra and a 1,017 km pipeline network till refinery at Bhatinda for crude oil transportation. HMPL has entered into a pipeline usage agreement with HMEL.
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