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Shares of Gati Ltd fell nearly 13 per cent to their lowest in more than a week on Monday, as CARE had downgraded the logistics company's bank facilities on Friday. The rating agency has cut its rating on Gati’s long-term bank facilities to BBB from A-, and downgraded the short-term bank facilities to A3+ from A2+.
The revision has been done after considering the decline in revenue from operations along with “significant deterioration in PBILDT (profit before interest, lease, depreciation and tax) level” and reduction in gross cash accruals during FY18, CARE said in its report.
Also, the company has raised additional debt during financial year 2018 for redeeming part of its foreign currency convertible bonds leading to higher debt repayment obligations in FY19, while the cash accruals are expected to remain relatively stressed, the report added.
The ratings, however, derive strength from the company's experienced management, extensive support from subsidiary companies for its e-commerce division and favourable industry prospects.
More than 1.1 million shares changed hands as of 0515 GMT, compared with their 30-day average volume of 842,809 shares. Up to last close, Gati's stock had declined over 40 per cent this year.
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