Moody’s boosts Indiabulls

Moody's Investors Service said it upgraded Indiabulls Housing Finance Ltd.'s long-term corporate family rating to B2 from B3. At the same time, Moody's raised Indiabulls' foreign- and local-currency ratings on its senior secured medium-term note program to (P)B2 from (P)B3.

“The upgrade of Indiabulls' ratings reflects the improvement in its stand-alone assessment, supported by stronger capitalization and a decline in loans at risk. The rating upgrade also considers the company's improving, yet constrained, funding access and uncertainty relating to its pivot to an asset-light business model,” Moody’s said in a press release.

The agency noted the company's tangible common equity to total managed assets (TCE/TMA) was at 24.3%, higher than 21.4% a year ago and its rights issue in February will boost the TCE/TMA to around 30%.

Indiabulls is exposed to large defaults due to its concentration in single-name borrowers. Its exposure to corporate loans, which are a major source of asset-quality stress, remains considerable, Moody’s said.

The outlook remains stable.

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