The rating agency says that the rating for GTPL reflects the adverse overall risk profile on account of the short track record of Acacia Mangium cultivation in India, uncertainty associated with the yield of the plantations on account of the inherent vulnerability to climatic conditions and the vagaries of nature and the vulnerability of the industry to the regulatory environment.

The rating is also indicative of GTPL's poor track record in the business, liberal accounting practices, highly skewed capital structure and poor profitability of operations. "The rating also factors in the advantages arising out of the fact that the schemes of the company is not to commit to any monetary returns eitherduring or on maturity of the instruments although the offer documents do indicate of estimated returns on the investments," the release said.

According to the rating agency, although the name of GTPL indicates interests in teak plantations, the company is actually engaged in cultivation of Acacia Mangium trees. For the year 1997-98 the company has an income of Rs 79 lakh and net profit of Rs 5 lakh.

The rating For Vipra Farm (India) Ltd reflects the adverse overall risk profile on account of uncertainty associated with the yield of the plantations on account of the inherent vulnerability to climatic conditions and the vagaries of nature and the vulnerability of the industry to the regulatory environment. The firm is an agro-based company primarily engaged in cultivation of teak trees.

These are, however, partially offset by the relatively higher average age of the company's trees thereby reducing to an extent the gestation period for the business and the existing moderate gearing levels.

According toCrisil, for SUL, the rating takes into consideration the high returns offered by the SUL's various schemes the ability to service which could be negatively impacted by a downturn in the company's agricultural operations.