CRISIL has downgraded Allcargo Logistics’ long-term rating to ‘Crisil A/Negative’ and short-term rating to ‘Crisil A2+’, removing them from ‘Rating Watch Negative’ due to continued subdued operating performance. Ratings on Rs. 508 crore bank facilities, now under Allcargo Global Limited (AGL) post-demerger, have been withdrawn. A negative outlook reflects expectations of flattish revenues and weak profitability for fiscal year 2026.
Revised Ratings Overview
CRISIL Ratings has downgraded the long-term rating to ‘Crisil A/Negative’ with a negative outlook, and the short-term rating to ‘Crisil A2+’ for Allcargo Logistics. These revisions reflect a downgrade from previous ratings, removing them from ‘Rating Watch with Negative Implications.’ The long-term rating’s negative outlook is based on expectations of continued subdued operating performance.
Facilities Transferred and Ratings Withdrawn
As part of a strategic realignment, CRISIL has withdrawn its ratings on bank facilities amounting to Rs. 508 crore. This action follows the transfer of these facilities to Allcargo Global Limited (AGL) as part of the demerger of Allcargo’s ISC business. Additionally, the ratings on Rs 507 crore of term loans and Rs. 60 crore of proposed term loans have been withdrawn due to complete repayment at the company’s request.
Factors Influencing the Downgrade
The ratings downgrade reflects CRISIL’s anticipation of subdued operating performance for the ISC business in fiscal 2026, characterized by flattish revenues and weak profitability. The ISC business generated revenues of Rs. 14,077 crore in FY25. The operating profitability has witnessed pressure over the last few years with the Pre-Ind AS operating profitability remaining subdued at approximately 2%. H1FY26 witnessed further moderation with negligible operating profits due to softening of charter rates, higher operational expenses and one-off charges.
Financial Risk Profile
The financial risk profile of Allcargo is considered average with a gross debt of Rs. 1,010 crore as of September 2025. It is expected that the gearing will remain comfortable at 0.50-0.60 times over the medium term, supported by a healthy net worth position. The company maintains liquidity in the form of cash and cash equivalents amounting to Rs. 431 crore.
Source: BSE
