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The long term rating for the Company’s line of credit has been revised to [ICRA]BBB+ from [ICRA]A and the short term rating to [ICRA]A2 from [ICRA]A1 . The reason for such revision in brief is as under:

The revision in ratings primarily take into account the lower than expected increase in tea production as well as realization, which together with adverse cost-structure, is likely to result in operating losses during FY2018, thus adversely impacting the debt-coverage indicators as well as liquidity position of the company. ICRA notes that the company had reported operating losses during FY2017 as well, post significant crop loss of around 1.1.Mkg as well as the fall in the overall realisation by around Rs 16/Kg during FY2017 vis-à-vis FY2016. Though, the production and realization has improved in the current financial year, the same may not be sufficient to fully recover the costs, thus negatively impacting the overall financial risk profile and is likely to result in negative cash accruals during FY2018.