India Ratings and Research (Ind-Ra) has downgraded Steel Authority of India (SAIL) long-term issuer rating to 'AA' from 'AAA'. The outlook is negative.

The downgrade reflects SAIL's credit metrics being lower than Ind-Ra's expectation for 9MFY16.

The steep fall in steel prices since January 2015 led to EBITDA losses for the company in 9MFY16 and the consequent worsening of its credit metrics.

SAIL's net sales realisation (NSR) declined 16.7% yoy to Rs 33,252/t in 9MFY16 driven by a 29% yoy increase in imports, excess domestic capacity, and moderate consumption growth of 4.7% yoy.

Ind-Ra however expects the net realisation to increase by Rs 3,000/t-Rs 4,000/t post the introduction of minimum import price (MIP) for steel in India effective from February 2016.

Shares of the company gained Rs 0.8, or 1.8%, to trade at Rs 45.25. The total volume of shares traded was 598,148 at the BSE (11.16 a.m., Wednesday).