S&P rates Indian Railway notes BB+

Standard & Poor's said it assigned its BB+ foreign currency debt rating to Indian Railway Finance Corp.'s (BB+/stable/--) proposed $125 million equivalent fixed-rate yen-denominated eurobond due 2010.

The ratings on Indian Railway Finance reflect its full government ownership and its unique position as the only agency that provides market funding for Indian Railway's locomotives, passenger coaches and freight wagons.

Proceeds of the bond issue will be used to finance the purchase of rolling stock and track machinery, which will be leased to the Ministry of Railways.

"In view of the IRFC's public policy role and the integral nature of its operations as part of Indian Railways, Standard & Poor's equalizes its ratings on IRFC with those on the sovereign (BB+/stable/B)," said S&P credit analyst Agost Benard.

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