Ratings firm Icra said in a report that Aditya Birla Retail has witnessed an equity infusion of R1,224 crore over FY13 and the first quarter of FY14, while upgrading the retail company to BBB+ from BBB.
Aditya Birla Retail that runs about 500 ‘More’ supermarkets and hypermarkets had reported a narrower net loss of R511 crore in FY13 from a net loss of R535 crore in FY12.
“The upgrade has taken into account... the improving performance of ABRL’s (including Trinethra) supermarket and hypermarket stores facilitated by continued rationalisation of operations with closure of unviable stores, cost control initiatives being undertaken by the company, along with improving sales per sq ft,” Icra said in a report.
Even though the sales per sq ft have been improving for ABRL’s stores, it would require further scale up to attain break even, Icra said. The ratings agency however added that the company is exposed to general economic slowdown and stiff competition.