Seshasayee Paper: CRISIL withdraws working capital ratings; ICRA's AA-(Stable) stands.

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AuthorSimar Singh|Published at:
Seshasayee Paper: CRISIL withdraws working capital ratings; ICRA's AA-(Stable) stands.
Overview

Seshasayee Paper and Boards Limited has announced the withdrawal of its credit rating for working capital facilities by CRISIL Ratings, effective February 20, 2026. This action was taken at the company's request. Meanwhile, ICRA Limited continues to assign strong ratings to the company's long-term debt facilities at 'ICRA AA- (Stable)' for ₹195 crore and 'ICRA A1+' for ₹97 crore short-term facilities.

Seshasayee Paper: CRISIL Exits Working Capital Ratings, ICRA's Stable View Continues

Seshasayee Paper and Boards Limited's long-term bank facilities valued at ₹195 crore and short-term facilities at ₹97 crore retain their strong 'ICRA AA- (Stable)' and 'ICRA A1+' ratings, respectively. This follows the withdrawal of ratings for its working capital facilities by CRISIL Ratings.

Reader Takeaway: CRISIL exits working capital ratings; ICRA's stable AA-(Stable) and A1+ view offers continued assurance.

What just happened (today’s filing)

CRISIL Ratings has withdrawn the credit rating for Seshasayee Paper and Boards Limited's working capital facilities. This action, effective February 20, 2026, was undertaken at the company's request.

Concurrently, ICRA Limited's established ratings for the company's debt facilities remain in place. These include 'ICRA AA- (Stable)' for long-term facilities amounting to ₹195 crore and 'ICRA A1+' for short-term facilities aggregating ₹97 crore, as assigned in January 2026.

Why this matters

Credit ratings are crucial indicators of a company's financial health and its ability to meet debt obligations. For working capital facilities, ratings often influence borrowing costs and the availability of credit lines.

The withdrawal by CRISIL means these specific facilities no longer carry that agency's assessment, while the continued affirmation by ICRA provides ongoing confidence in the company's creditworthiness for its broader debt structure.

The backstory (grounded)

Seshasayee Paper and Boards Limited (SPBL) has a history of rating actions. In August 2023, CARE Ratings withdrew its ratings for the company's bank facilities upon the company's request and with no-objection certificates from its bankers.

More recently, in April 2025, CRISIL Ratings had revised SPBL's outlook to 'Negative' from 'Stable', while reaffirming the 'CRISIL AA-' rating. This revision was attributed to a significant decline in profitability due to lower realisations and increased raw material prices.

ICRA Limited's ratings of 'ICRA AA- (Stable)' for long-term and 'ICRA A1+' for short-term facilities were assigned in January 2026, effective from January 30, 2026.

What changes now

  • Seshasayee Paper's working capital facilities are no longer rated by CRISIL.
  • The company continues to benefit from strong credit ratings assigned by ICRA for its long-term and short-term debt.
  • This may lead to a shift in how lenders assess the credit risk associated with the working capital lines.
  • The company's ability to secure favourable terms for future working capital needs might be influenced by having one less rating agency's assessment.

Risks to watch

While ICRA's stable outlook provides comfort, the withdrawal of CRISIL ratings for working capital facilities could potentially affect borrowing costs or credit accessibility for these specific instruments.

Investors will monitor if this impacts the company's overall credit perception or its ability to raise working capital efficiently in the future.

The previous 'Negative' outlook by CRISIL in April 2025 highlights ongoing industry pressures, including volatile raw material prices and competition from cheaper imports, which could continue to challenge profitability.

Peer comparison

Seshasayee Paper operates in the competitive Indian paper manufacturing sector alongside companies like JK Paper Ltd., West Coast Paper Mills Ltd., Andhra Paper Ltd., and Tamil Nadu Newsprint & Papers Ltd.. While SPBL has strong ratings from ICRA, specific current credit ratings for the debt facilities of its major peers were not readily available in the search results. However, SPBL's 'ICRA AA-' rating is considered a high investment grade, indicating strong credit quality.

Context metrics (time-bound)

  • The company's net cash reserves stood at over ₹500 crore as of September 2025.
  • Long-term bank facilities rated by ICRA amount to ₹195 crore as of January 30, 2026.
  • Short-term bank facilities rated by ICRA amount to ₹97 crore as of January 30, 2026.
  • Net profit declined by 59.7% year-on-year in FY25 to ₹1,092 million.

What to track next

  • Monitor any future announcements or reviews from ICRA regarding Seshasayee Paper's credit ratings.
  • Observe any changes in borrowing costs or terms for the company's working capital facilities following the CRISIL rating withdrawal.
  • Assess the company's operational performance in the context of past profitability challenges and industry pressures.
  • Track the overall demand and pricing dynamics within the Indian paper industry.
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