Moody's cuts Indian Oil outlook to negative

Moody's Investors Service said it changed the outlook on the Baa2 issuer rating of Indian Oil Corp. Ltd. to negative from stable.

"The change in outlook to negative reflects the persisting challenges arising from the oil subsidy scheme in India and the consequent financial impact on IOC," said Terry Fanous, senior vice president.

"The burden of under-recoveries is being exacerbated by the high oil prices which are straining Indian Oil's liquidity profile and credit metrics at the Baa2 rating level."

The ratio of retained cash flow /debt is likely to remain below the 20% guidance for the Baa2 rating in FY08 and FY09, based on the current subsidy scheme and continued high oil price environment, the agency noted.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.