The turmoil in the aviation industry due to the spread of coronavirus has started reflecting on the ratings of debt securities issued by Indian carriers. On March 24, rating agency CRISIL downgraded its rating on the non-convertible debentures (NCDs) of government-owned Air India amounting to ₹700 crore. The rating of these NCDs was downgraded to CRISIL BB+(CE) from CRISIL AAA(CE), and the rating remains on ‘Rating Watch with Negative Implications’. However, the ratings on the remaining NCDs (₹5,500 crore and ₹7,400 crore) of Air India have been reaffirmed by the rating agency at CRISIL AAA(CE)/Stable.
What happened?
The CRISIL rating document says that the NCDs worth ₹700 crore is due to be repaid on March 26, 2020. The NCDs were issued in March 2010 and carry a coupon rate of 9.13 per cent.
