We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

Viramgam Mahesana Project Limited Essay Sample

  • Pages: 3
  • Word count: 658
  • Rewriting Possibility: 99% (excellent)
  • Category: company

Get Full Essay

Get access to this section to get all help you need with your essay and educational issues.

Get Access

Introduction of TOPIC

ICRA has reassigned the long term rating for the 32.58 crore term loans of Viramgam Mahesana Project Limited (VMPL) from [ICRA]A+ (pronounced ICRA A plus) to [ICRA]A+(SO) (pronounced ICRA A plus † Structured Obligation) .The letter SO in parenthesis suffixed to a rating symbol stands for Structured Obligation. An SO rating is specific to the rated issue, its terms, and its structure. SO ratings do not represent ICRA’s opinion on the general credit quality of the issuers concerned. The SO rating is based on the escrow mechanism being followed by VMPL which provides a higher priority to debt service obligations.

The company also maintains a liquidity support in terms of debt service reserve account (equivalent to six-month debt obligations) to ensure timely servicing of debt obligations. The rating continues to factor in VMPL’s low operational risks, its stable revenue base and its low counter-party risks. VMPL has a contractual fixed annuity payment agreement with Western Railways, an operating division of Indian Railways, for a period of 12 years. However, the rating is constrained by VMPL’s pending sales tax issue under which it is required to deposit a Value Added Tax (VAT) of 12.5% on semi-annual access charges received (around Rs.1 crore) with the High Court of Gujarat as per its order, till the matter is resolved.

Moreover, the rating factors in the susceptibility of VMPL’s cashflows to the change in taxation rates (Minimum Alternate Tax a

nd VAT), as payment of these taxes constitutes a major portion of the company’s total outflows and

Sorry, but full essay samples are available only for registered users

Choose a Membership Plan
change in interest rates on the rated facility. Further, the rating takes into account the support extended by VMPL to its group companies in the form of unsecured loans. Company Profile VMPL is an SPV incorporated in February 2003 to undertake the railway gauge conversion (from metre gauge to broad gauge) project between Viramgam and Mahesana section. DSC Limited, the flagship company of DSC group, has 99.89% stake in the project while the rest is held by its associates.ViramgamMahesana section (65-km length) is situated in the state of Gujarat. Viramgam is about 61 km west of Ahmedabad and Mahesana is about 67 km north of Ahmedabad. The link is strategically located on the railway lines linking the important ports of Gujarat, such as Kandla, Mundhra and Okha to North India. The project became operational in December 2004 and is receiving fixed semi-annual access charges from the Western Railways (WR) since then.

As per the terms of the Concession Agreement, VMPL is to get 24 fixed semi-annual access charges for the site after achievement of the COD, out of which it has received 16 installments so far. WR is now responsible for the entire operations and maintenance of the track. VMPL’s liability in terms of maintenance of the track (defects liability period) was limited to a 12 months period from the Commercial Operation Date (COD), which is already over. At the end of the concession period, the project assets and facilities would get transferred to WR, without any charge or consideration.

Contents may be used freely with due acknowledgement to ICRA ICRA ratings should not be treated as recommendation to buy, sell or hold the rated debt instruments. The ICRA ratings are subject to a process of surveillance which may lead to a revision in ratings. Please visit our website (www.icra.in) or contact any ICRA office for the latest information on ICRA ratings outstanding. All information contained herein has been obtained by ICRA from sources believed by it to be accurate and reliable. Although reasonable care has been taken to ensure that the information herein is true, such information is provided ‘as is’ without any warranty of any kind, and ICRA in particular, makes no representation or warranty, express or implied, as to the accuracy, timeliness or completeness of any such information.

We can write a custom essay on

Viramgam Mahesana Project Limited Essay Sample ...
According to Your Specific Requirements.

Order an essay

You May Also Find These Documents Helpful

Australian food and liquor business Woolworths company

S1. Pioneer and among the oldest companies to introduce the modern retail trade model Woolworths limited was founded in September 1924, which was the very first store based company in Australia during that time. As a result, it gains customer’s interest as there was variety of groceries, magazines, health product and so on just in one place. Soon, Woolworths company had a little interest in shareholders to accelerate the brand\'s growth. However, as trading goes on and shareholders brought more capital, the dividends paid by the company increased from 5% to 50% after its third year of operation. (Woolworth Ltd, 2017) Since December 1924, more branches of the store were established across Australia. Besides, Woolworths store began to sell variety of goods, with the priority of cheaper price and money back guarantee which has gain consumer’s interest. Furthermore, Woolworths stores became the first supermarket in the world to install receipt machines...

Coca-Cola Company

Coca-Cola Company is an American multinational beverage corporation and manufacturer, retailer and marketer of nonalcoholic beverage concentrates and syrups. Coca- Cola Company has been found 131 years ago in May 8,1886 in Atlanta, Georgia, U. S. by Asa Griggs Cadler and John Pemberton. John Stith Pemberton is pharmacist who invented formula for the most popular product Coca-Cola in 1886 in Columbus, Georgia. The formula is still a trade secret. Coca-Cola is a carbonated soft drink where the drink’s name refers two of its original integrities, which are kola nuts (source of caffeine) and cola leaves. Based on Interbrand’s “best global brand” study of 2015, Coca-Cola was the word’s third most valuable brand, after Apple and Google. But, was it always like that? What happened in the past with Coca-Cola? Where they always mindful with their responsibilities? Crisis situation In 1990s, Coca-Cola has been accused of unethical behavior in a number...

The American landscape and lifestyle

“Baseball caps and hats are as much a part of the American landscape and lifestyle as just about any apparel accessory.” (Threadlogic Source) If the United States had a national hat, it surely would be the baseball hat. The popularity of logoed embroidered headwear is evident anytime you are out in public, and especially at a sporting event, men, women, and children show support for their teams across both professional and collegiate arenas. It would be difficult to find someone in the US who hasn’t worn a hat on at least one occasion, whether that be forward, backward, sideways, or even inside out. Regardless of the taste of the customer, there are enough styles, fits, and finishes to satisfy everyone. New Era is the largest sports licensed headwear company in the world. According to their VP of global marketing, they sell more than 20 million hats annually with over 60%...

Popular Essays


Emma Taylor


Hi there!
Would you like to get such a paper?
How about getting a customized one?