Moody’s rates Indian Oil notes Baa2

Moody's Investors Service said it affirmed Indian Oil Corp. Ltd.'s Baa2 issuer and senior unsecured ratings.

At the same time, Moody's assigned a Baa2 rating to the company’s proposed dollar-denominated senior unsecured notes.

The outlook is stable.

“The affirmation of IOCL's ratings reflects our expectation that the company's leverage will stay within the tolerance level of its ratings, despite negative free cash flow because of high shareholder returns and capital spending,” Vikas Halan, Moody's senior vice president, said in a news release.

“IOCL's ratings also remain constrained by the uncertainty around the Indian government's policy for the oil & gas sector, especially with respect to fuel pricing and consolidation in the sector.”

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