Fitch affirms Chemplast

Fitch Ratings said it affirmed Chemplast Sanmar Ltd.'s ratings and removed them from Rating Watch negative, including the BBB-(ind) national long-term rating, the BBB-(ind) long-term bank loans and secured fund-based lines of credit and the F3(ind) secured non fund-based lines of credit.

The outlook is negative.

The agency said the resolution of the Rating Watch and the affirmations are based on the successful commissioning of Chemplast's Greenfield PVC plant and coal-based power plant as well as the company's favorable relationship with its bankers, which has enabled it access to bank funds in 2009 and 2010 when its operational cashflows were under stress and were insufficient to meet its debt service obligations.

Fitch said the outlook is negative on the back of Chemplast's high debt levels, which can only moderate with sustained profitability at its new plant.

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