"The prospect of timely serving of debt is the best with IBP, the parent concern being the major shareholder, having 61.8 per cent of its equity of Rs 16.3 crore", Icra said in a statement today.

BL has built up a dominant position in the barrel industry with its multi-locational facilities, long relationship with customers and acquisition of competitors capacities. During the last year the company had reported notable growth in its profitability front. BL's operations in manufacturing of MS barrels, grease and lubricating oil and leather chemicals have grew considerably. BL also has the three year focus on service sector with its travel, logistics management and project engineering business contributing 51 per cent of operating income of Rs 648.5 crore in 1999-00.

Its operating margins have improved in the current fiscal to 5 per cent, up from last year's 3.7 per cent. Return on capital has been in the range of 11 per cent to 14 per cent over the period of 1997-00. BL's liquidity position is comfortable with operational surplus during 1998-99 and 1999-00. Icra expects growth in its service business levels to help in maintaining overall operating margins at 1999-00 levels in the short-term. While profitability in 2000-2001 is expected to be adversely affected by a high provision burden and depreciation charge on new capacities, cash accruals are expected to improve.