Moody's Investor's Service has placed the long-term foreign currency bonds and notes of 38 issuers on review for a possible upgrade. ICICI Ltd, which has a current credit rating of 'Ba2' from Moody's that matches the sovereign risk levels, is the only institution from India figuring in the review exercise. Once its rating is upgraded, ICICI will be the first Indian corporate to pierce the country rating.
The latest review is the result of a change in the global rating agency's long-standing approach to permitting the rating of foreign currency bonds of debt issuers to exceed their country's ceilings.
ICICI has a total of Rs 10,100.82 crore outstanding by way of foreign currency loans. Loans from multilateral /bilateral credit agencies amount to Rs 2147.27 crore, from international banks, institutions and consortiums Rs 5222.55 crore, while Rs 561.30 crore is by way of bonds and Rs 2169.70 crore by way of notes.
Moody's said the ratings under review for upgrade include foreign currency bonds and notes of energy companies, financial institutions and telecommunications companies in Latin America, Eastern America, Europe, Asia, the Middle East and Africa.
The factors that will decide the rating upgrade are - credit worthiness of the issuer (including external support mechanism), probability that there would not be a generalised moratorium in the event of default by the government in question on its own foreign currency obligations and the special circumstances of the borrower in terms of access to foreign exchange.
The rating agency said additional entities may be placed on review for upgrade over the next six months.
