Credit Analysis & Research (CARE) reaffirmed 'AA' ratings to Trent's long -term bank facilities of Rs 650 million.

CARE reaffirmed 'A1+' ratings to the company's short-term bank facilities of Rs 180 million. CARE reaffirmed 'AA' ratings to the company's non-convertible debenture of Rs 2.25 billion.

The ratings continue to factor in Trent's (Trent) strong parentage and experienced management, sound capital structure and comfortable liquidity position. The ratings also factor in the equity infusion to the tune of Rs 1.50 billion during FY13 (refers to the period April 1 to March 31) and improved performance of its Westside store format in FY13 and H1FY14.

The ratings are, however, tempered by the continued losses in its wholly-owned subsidiaries Trent Hypermarket (THL) and Landmark and challenging outlook for the lifestyle retailing segment due to the prevalent subdued economic scenario.

While the recent announcement by Tesco PLC (Tesco) to acquire 50% stake in THL augurs well for Trent as it would benefit from operational expertise and financial commitments likely to be received from Tesco, the timeline of overall structuring of the deal and future business strategy would emerge in due course of time.

The ability of Trent to maintain a favourable capital structure and stabilize the business of its subsidiaries remain the key rating sensitivities.

Shares of the company gained Rs 25.45, or 2.17%, to settle at Rs 1,197.45. The total volume of shares traded was 8,979 at the BSE (Tuesday).