"These ratings indicate upper medium grade instruments and safety forprincipal and interest are considered adequate. The rating takes intoaccount IFCI's position as the oldest of the three all India developmentfinance institutions, its ownership by large public-sector financial andinvestment institutions, and the favourable impact these two factors have onits resource raising abilities," a CARE release issued said.

However, factors discounting the above strengths are its high exposure tothe risky project finance segment, its weak asset quality and high level ofnon-performing assets (NPAs), low capital adequacy, continuous pressure onits spreads due to increasing cost of borrowings, and difficult assetliability maturity profile. The rating also takes into account the fact thatthe management of IFCI is fully seized of the present financial situationand has chalked out a remedial strategy.

The rating agency has assigned `PR1' rating to the Rs 10 crore commercialpaper (CP) programme of the SK Bangur group company, West Coast Paper MillsLtd, and a `PR1+' rating to the Rs 5-crore CP programme of Bajaj ElectricalsLtd.

Meanwhile, the Credit Rating Information Services of India Ltd (Crisil) hasreaffirmed the AA- rating of the Rs 203-crore non-convertible debentures(NCD) of Indian Petrochemicals Corporation Ltd, and the P1+ rating assignedto its Rs 350-crore CP issue.

"The reaffirmation of the high safety category rating reflects the progressachieved by IPCL in the implementation of second phase of Gandhar projectand factors in the company's leading market position in the domesticpolymers industry, geographically diversified and integrated manufacturingoperations and the access to cheaper inputs," a Crisil release issued inMumbai on Wednesday said.

Meanwhile, Crisil has also reaffirmed the `AA+' ratings assigned to the Rs766 crore NCD issue of Tata Iron and Steel Company (Tisco) and has assignedthe highest safety ratings to the proposed FD and Rs 400 crore CP issues ofthe company.