NEW DELHI: Credit ratings agency ICRA on Friday downgraded cash-strapped airline Jet Airway’s long-term ratings from ‘B’ to ‘C’, citing delays in the implementation of the proposed liquidity initiatives by the management. The firm’s short-term ratings, however, have been reaffirmed to ‘A4’. The ratings downgrade is the second such action since October.
According to ICRA, the delays in boosting liquidity have been reflected in the delays in employee salary payments and lease rental payments to the aircraft lessors. Instruments with a ‘C’ rating are considered to have very high risk of default regarding timely servicing of financial obligations, ICRA noted, with the ratings assigned to Jet Airways’ Rs 698.9-crore NCDs programme, Rs 4,970 crore of long-term, Rs 645 crore of long-term, fund-based facilities, and Rs 700 crore of long-term and non-fund based facilities. According to Icra, Jet Airways has large debt repayments due over the next four months (December-March) of FY19 (Rs 1,700 crore), FY20 (Rs 2,444.5 crore) and FY21 (Rs 2,167.9 crore).