S&P Global revises credit rating of PSUs

Outlook on Indian government owned NTPC, ONGC, and Power Grid Revised to Positive from Stable with affirmed ratings.

S&P Global Ratings has revised the rating outlook to positive from stable on NTPC, ONGC, and Power Grid. The actions follow the revision of the outlook on the sovereign rating of India (BBB-/Positive/A-3) to positive from stable. The credit rating has affirmed its 'BBB-' issuer and issued ratings on these companies.

These companies have stronger stand-alone credit profiles (SACPs): ONGC's SACP is 'bbb+'; Power Grid is 'bbb'. An upgrade of the sovereign to 'BBB' would therefore result in a corresponding upgrade of these entities, as per credit rating agency.

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The positive rating outlook on NTPC reflects its outlook on the sovereign credit rating in India. The rating agency said NTPC's capital expenditure (capex) or investments are substantially higher than our expectations without offsetting earnings.

The positive rating outlook on ONGC reflects the long-term sovereign credit rating outlook in India. It also reflects the expectation that ONGC will maintain its solid stand-alone creditworthiness, benefitting from a strong financial profile and status as a national oil company.

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