Never miss a great news story!
Get instant notifications from Economic Times
AllowNot now

You can switch off notifications anytime using browser settings.

Fitch Ratings raises Reliance’s outlook to positive

Fitch Ratings has affirmed the long-term foreign-currency IDR at 'BBB-' with a stable outlook.|
Aug 16, 2019, 03.47 PM IST
Mumbai: Fitch Ratings on Friday revised outlook on Reliance Industries’ (RIL) long-term local-currency issuer default rating (IDR) to positive from stable and affirmed ratings at 'BBB', due to the potential to further deleverage its balance sheet.

At the same time, the ratings agency has affirmed the long-term foreign-currency IDR at 'BBB-' with a stable outlook, as RIL's Foreign-Currency IDR is capped by India's country ceiling of 'BBB-'.

“The outlook on the local-currency IDR was revised to positive due to the potential for RIL to further deleverage following its announcement that it will eliminate its net debt by the financial year ending March 2021 (FY21) and that it plans to sell 20 per cent stake in its oil-to-chemical division to Saudi Arabian Oil Company,” Fitch said in a release.

“We forecast its adjusted net debt/Ebitdar to reach 1.5 times over the next 18 to 24 months,” it added.

Fitch also said the affirmation reflect RIL's strong business profile - a large-scale refinery with a capacity of around 1.2 million barrels a day and asset quality that enables it to consistently deliver a gross refining margin (GRM) above regional benchmarks.

RIL also benefits from its vertically integrated business model and dominant market position in petrochemicals, which smooths out profit volatility along the refining and petrochemical value chain, Fitch said, adding that the company has completed capex to increase its downstream integration, which has improved feedstock flexibility.

Also Read

Fitch Ratings’ Nitin Soni on telecom sector in India

Tariff hike not sufficient for Voda Idea, credit positive for Bharti: Nitin Soni, Fitch Ratings

Fitch Rating says tariff hikes, recent govt relief won’t offset impact of AGR dues

Immediate payment of dues may cripple 5G bids by telcos: Fitch Ratings

Add Your Comments
Commenting feature is disabled in your country/region.
Download The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.

Other useful Links

Follow us on

Download et app

Copyright © 2019 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service