Chembond Material Technologies Ltd: CRISIL Downgrades Ratings Due to Demerger of Water Technologies and Construction Chemical Business

Chembond Material Technologies Ltd. has announced that CRISIL has downgraded its ratings for total bank loan facilities due to the demerger of Water technologies and Construction chemical business from the group. The long-term rating has been downgraded to 'CRISIL BBB/Stable' from 'CRISIL BBB+' and the short-term rating to 'CRISIL A3+' from 'CRISIL A2'. The rating watch with negative implications has been removed for both. The downgrade is a result of the weakening business risk profile due to the demerger, which has reduced the scale of operations. However, the financial risk profile remains comfortable due to the limited dependence on external borrowing and healthy capital structure. The rating reflects the extensive promoter experience in the chemical industry, which has helped establish a good market position and comfortable financial risk profile for the group. The continuing business of Chembond Material Technologies Ltd. will now have Metal treatment and animal health business only, leading to an impact on the overall scale of operations.