IOL Chemicals hits new high

IOL Chemicals Pharmaceuticals, since the past three days has been hitting new highs, accompanies with a good surge in volumes. Today, its new high was at Rs.206.65 and continues to remain firmly in the green.

The stock price is reacting to CARE Ratings revising rating on long term bank facilities to CARE BBB+ from CARE BBB- and of short term bank facilities to CARE A2 from CARE A3.

This is based on, as stated by CARE, “the improvement in the operational performance of the company reflected by significant growth in total income and expansion in margins resulting in healthy growth in cash accruals. The revision in ratings also factors in improvement in financial risk profile marked by a reduction in gearing and strengthening of debt service metrics.”

CARE has stated, “the ratings however, remain constrained by raw material availability and price volatility risk, working capital intensive nature of the operations and significant product concentration in revenue profile.”