CARE Ratings downgrades Reliance Capital's debt programme to 'D'

CARE said the liquidity profile of the group continues to be under stress on account of delay in raising funds from the asset monetisation plan and impending debt payments.
Anil Ambani. (Photo | PTI)
Anil Ambani. (Photo | PTI)

MUMBAI: CARE Ratings has downgraded Anil Ambani-led Reliance Capital's debt programmes worth Rs 17,000 crore to 'D' on account of the recent instance of delay in servicing of coupons on several non-convertible debentures (NCDs).

However, the company said that the payments were delayed by only one day due to a technical glitch in bank servers.

CARE said the liquidity profile of the group continues to be under stress on account of delay in raising funds from the asset monetisation plan and impending debt payments.

"Apart from this, Reliance Capital does not have any liquid investments or unutilised committed lines. Thus, its liquidity is critically dependent on the monetisation of its sale of group assets and investments within the given timelines, given that there are scheduled repayments of standalone debt worth Rs 1,642 crore from August 2019 to December 2019. Reliance Capital has also further extended fresh corporate guarantees towards various group entities' debt," said CARE.

In a statement, Reliance Capital said: "The interest payment for NCDs which was due on September 9 was duly activated on the due date, but the same could not go through owing to technical glitch in bank servers on that date, and the payment went through on the very next bank working day, that is September 11. These facts were also confirmed by the company's lenders who had been providing financing for the above-mentioned payments."

It said CARE acted in a pre-meditated and prejudiced manner. "CARE's pre-meditated and prejudiced actions are further borne out by the manner in which it conducted the SEBI prescribed review process."

Reliance Capital added: "The highly unprofessional, biased and prejudiced and unjustified actions of CARE will precipitate a chain sequence of events that will gravely harm the interests of millions of retail and institutional investors having direct and indirect exposure to securities of the company."

At 10:45 am on Monday, its scrip was trading at Rs 28.60, down 8.7 per cent.

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