Deepak Fertilisers slipped almost 1.5% intra day to Rs.159.10 and continues to remain in the red though it has now recovered to Rs.160 levels.

The stock is down and lackluster, like the rest of the market. Adding to its woe today is the rating downgrade by ICRA. It downgraded the long-term rating of its Rs.600-crore non-convertible debenture programme, Rs.575-crore (increased from #8377;500 crore) long-term fund-based limits and Rs.141.44-crore term loans from AA to AA-. The outlook on the rating now stands at negative.

ICRA stated that the downgrade takes into account the deterioration in the financial profile of the company, owing to the “continued regulatory overhang over the gas supply issue and the recovery of unintended benefits from players manufacturing Nutrient “N” using domestic gas.

ICRA added that  company’s working capital position has weakened over the last one year due to holding up of subsidy payments by the Department of Fertilisers’ pending recovery of unintended benefits, resulting in significant build-up of short-term debt.