CARE Ratings has reaffirmed AA and A1 plus status with a positive outlook to long-term and short-term bank facilities of Gujarat Gas Ltd (GGL), India's largest city gas distribution player with customer base in residential, commercial and industrial segments.
"The positive outlook on the long-term rating of GGL continues to reflect CARE's expectation of further growth in its scale of operations along with improvement in its leverage and debt coverage indicators," said the rating agency.
The ratings continue to derive strength from GGL's leading position in the city gas distribution business, well-established and significantly large scale of operations, established gas sourcing arrangements, moderately diversified customer segment mix, comfortable debt coverage indicators, healthy cash accruals along with strong liquidity and efficient working capital management, it added.
The company has 23,200 km of gas pipeline network, 344 CNG stations distributing 8.5 million metric standard cubic metres per day (MMSCMD) of natural gas to 13.55 lakh households, serving two lakh CNG vehicles per day and to over 3,540 industrial customers.
GGL has presence spread across 23 districts in Gujarat, union territory of Dadra and Nagar Haveli besides Thane which includes Palghar district of Maharashtra.
In tenth city gas distribution bidding round announced by the Petroleum and Natural Gas Regulatory Board, the company won six geographical areas comprising of 17 cities in Punjab, Haryana, Madhya Pradesh and Rajasthan.
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