Bharti Airtel’s rating on review for downgrade   

The telecom firm’s consolidated adjusted debt/EBITDA stood at around 4.5x, as of 30 September 2018. 

Published: 09th November 2018 06:48 AM  |   Last Updated: 09th November 2018 06:48 AM   |  A+A-

The Bharti Airtel office building in Gurugram on the outskirts of New Delhi. (File Photo | Reuters)

By Express News Service

BHUBANESWAR: Telecom major Bharti Airtel may face a rating downgrade soon on the back of low levels of profitability and anticipation of weak cash flow, said Moody’s Investors Service. The rating agency has placed on review for downgrade the ‘Baa3’ issuer and senior unsecured rating of Bharti Airtel and the ratings on the backed senior unsecured notes issued by Bharti’s wholly-owned subsidiary, Bharti Airtel International (Netherlands) B V, it said in a statement. 

“The review for downgrade is primarily driven by our expectation that Bharti’s cash flow generation will remain weak and leverage elevated,” said Annalisa DiChiara, vice-president and senior credit officer at Moody’s. The review also reflects the company’s low levels of profitability, particularly from its core Indian mobile operations, negative free cash flow and higher debt levels to fund capital spending.

“We believe a more rational competitive environment in telecommunications market is unlikely over the next 12-18 months, the review also reflects uncertainty as to whether the company’s profitability, cash flow situation and debt levels can improve sustainably and materially over the same period,” added DiChiara, who is also Moody’s lead analyst for Bharti.

The telecom firm’s consolidated adjusted debt/EBITDA stood at around 4.5x, as of 30 September 2018. 
Moody’s noted the review on the rating will focus on Airtel’s plans to reduce debt levels over a short period of time and its turnaround strategy underlying the mobile operations business. Moody’s expects that most of the $1.25 billion raised from the pre-IPO of its African business will be used to reduce debt.

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp