CARE reaffirms rating Hero Financial Services
CARE has retained the rating assigned to the outstanding Fixed Deposits (FD) aggregating to Rs.0.14 crore (as on March 17, 2007), of Hero Financial Services Ltd (HFSL), at CARE BB+ (FD) [Double B Plus]. Instruments with this rating are considered to offer inadequate safety for timely servicing of debt obligations. Such instruments carry high credit risk.
The rating takes into account limited financial activities of the company, operating losses and sharp deterioration in asset quality. However, HFSLs satisfactory capital adequacy and support from the Hero Group cushion the fall in rating. HFSL, a closely held company of the Hero group, was incorporated in 1987 to finance the sale of two-wheelers, namely Hero Puch and Hero Honda motorcycles. Currently, the operations of the company are negligible and it is concentrating on repayments to fixed deposit holders.