Thomas Cook India's Credit Rating Reaffirmed at Crisil AA/Stable and Crisil A1+
CRISIL reaffirmed Thomas Cook India's long-term rating at Crisil AA/Stable and short-term rating at Crisil A1+. The company's rating is supported by its parent, Fairfax Financial Holdings Ltd, and its strong market position. Revenue grew 7.4% to ₹6,628 crore in 9MFY26. A demerger of the resort business is planned.
Credit ratings are critical for a company's financial standing, influencing its ability to raise capital, borrow money, and its overall investor confidence. A stable and strong rating is a significant positive indicator.
The credit rating has been reaffirmed at a strong level (AA/Stable and A1+), indicating financial stability and a positive outlook. The rationale highlights strong parent support, market leadership, and improved financial performance.
CRISIL has reaffirmed the long-term credit rating of Thomas Cook (India) Limited at “Crisil AA/Stable” and the short-term rating at “Crisil A1+”. The reaffirmation was communicated on March 31, 2026.
The company's rating benefits from strong support from its parent, Fairfax Financial Holdings Ltd. This is further bolstered by Thomas Cook India's robust business risk profile, holding leadership positions in the travel and foreign exchange segments, alongside a healthy presence in hospitality and digital photo imaging. The company demonstrated improved performance in fiscal 2025 and the first nine months of fiscal 2026, driven by significant growth across its segments, particularly in travel, which contributes over 75% to total revenue. This, coupled with a structural reduction in costs, has led to a healthy operating margin and return on capital employed. The financial risk profile has also strengthened due to sustained operating performance, evidenced by an adequate capital structure and strong liquid surpluses.
CRISIL also noted the proposed composite scheme of arrangement involving Thomas Cook India, Sterling Holiday Resorts Ltd, and other subsidiaries. This scheme involves demerging the resort and resort management business into its subsidiary, Sterling Holiday Resorts Ltd, followed by a potential listing of the latter. Post-demerger, Thomas Cook India's consolidated revenue and EBIT are expected to decrease by 5-8% and 20-30%, respectively. However, the overall credit risk profile is anticipated to remain robust with a comfortable capital structure and strong liquidity.
Furthermore, CRISIL acknowledged the impact of the ongoing Middle East conflict on Thomas Cook India's operating performance, with the quantum of impact contingent on the conflict's duration. The company indicated potential fixed cost reduction initiatives if the situation prolongs. The ratings draw comfort from the company's strong liquidity position, with unencumbered balances of ₹770-780 crore and majorly undrawn funded bank limits of ₹200-250 crore.
In the first nine months of fiscal 2026, Thomas Cook India witnessed a revenue growth of approximately 7.4% year-on-year, reaching ₹6,628 crore. This growth was primarily driven by the travel and leisure hospitality segments. However, the operating margin declined by about 40 basis points to approximately 6.8% during the same period, attributed to geopolitical disruptions, adverse weather conditions, and other macro-economic headwinds.
Financially, the consolidated financial risk profile is expected to remain comfortable, with a healthy capital structure and debt protection metrics. As of September 30, 2025, tangible net worth stood at ₹1,533 crore against total debt of ₹508 crore, with gearing at approximately 0.34 times. The group's liquidity is also improving, with cash and bank balances of ₹2,346 crore as of February 2026.
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Thomas Cook (India) Limited filed this with the NSE as a statutory disclosure, categorised under credit ratings. It is a primary document, not a recommendation, and the desk marks it high impact, which is the band that most often changes something.
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