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Reliance Infrastructure's long-term issuer rating was today downgraded by India Ratings to 'IND AA-' from ‘IND AA’, with a stable outlook.
Worsened debt metrics and inter-corporate deposits were some of the reasons for the downgrade, the rating agency said.
“The downgrade reflects the company’s reduced liquidity on account of a decline in its cash balances, and increased support to the projects of its subsidiaries and associate companies. This is indicated by a rise in inter-corporate deposits,” the agency said, in its report.
The ratings, the agency said, were moderated due to business risk from RInfra’s infrastructure investments. Accumulation of regulatory assets on account of delays in passing on increases in power purchase costs through tariff to consumers, is also yet another reason for the downgrade.
