Following is the text of press release issued by
The ratings reflect established market position of Optimus, supplemented by its sound business model, sizeable operational scale, and operational synergies arising from its association with
Although business volumes are expanding, pressure on margins, along with high finance cost is keeping profitability under check. Nevertheless, Optimus' subsidiary - Calcorp - is in profits, which enable it to avail tax benefit from available tax losses.
Meanwhile, increased leveraging, stressed cash flows, and less than adequate debt coverage signify financial risk. The company intends to gradually expand its operations, while keeping a close check on its cost structure to sustain margins. It is exploring various options, including new equity partners, to fuel fleet expansion and to refinance a portion of its debt repayments.
Given thin bottom-line margins, the company's ability to rationalize its overall financial profile, while improving operational profitability would be critical. Meanwhile, any increase in debt levels without adequate support from cash flows, compromising debt servicing capacity, would negatively impact the ratings.
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