Fine Organic Industries said that the credit rating agency ICRA has reaffirmed the company's long-term rating at '[ICRA] AA' with 'stable' outlook.
The agency has also affirmed the companys short-term rating at '[ICRA] A1+.
ICRA said that the rating reaffirmation factors in Fine Organic Industries (FOIL) established marked position and the extensive experience of the promoters in the oleochemicals industry for more than five decades.
The ratings also factor in its long-standing relationship with a diversified clientele which includes reputed players from the petrochemical, cosmetics and food industries. The company has a vast portfolio of 450+ products which find application in multiple industries.
The ratings also factor in the companys strong product and process innovation capabilities, supported by a strong in-house research and development (R&D) facility.
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The ratings are further backed by FOILs robust financial risk profile, characterised by healthy cash flow from operations, nil debt levels as on FY2024-end and large unencumbered cash balances.
The ratings are, constrained by the susceptibility of the companys profitability to volatility in raw material prices, evident from the variation in its operating margins over the last few years. However, ICRA notes that the company has been able to pass on the price impact with some lag and maintain average margins over a certain period.
The ratings also factor in the exposure of FOILs profitability to adverse exchange rate movements; however, the company undertakes hedging to mitigate the risk.
Fine Organic Industries (FOIL) is the flagship company of the Fine Organic Group. The Group is engaged in the manufacturing of oleochemical additives for various end-user industries such as foods, plastics, rubbers, paints, inks, cosmetics, coatings, feed nutrition, etc.
The scrip had declined 1.59% to end at Rs 5218.80 on the BSE yesterday.
Domestic equity markets are shut today on account of Muharram.
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