Moody’s & ICRA on the Indian Power Sector
“India’s state-owned power distribution companies will demonstrate weak to moderate financial profiles,” says Abhishek Tyagi, a Moody’s Vice President and Senior Analyst. “Nevertheless, we do not expect the emergence of material off-taker risk over the next 12-18 months. Consequently, India’s independent power producers should maintain credit metrics consistent with their current credit quality.”
“Greater funding diversity will help the power companies to expand capacities and add renewable capacities, although corporate-type debt funding will remain dominant for power companies in India,” adds Tyagi. “Bonds issued by Indian renewable generators in 2017 are examples of interest by institutional funds in the sector.”
“The rise in India’s share of renewable energy — especially in solar and wind generated electricity — in the overall capacity addition will be aided by improved tariff competitiveness, a supportive regulatory framework and strong policy support,” says Sabyasachi Majumdar, an ICRA Senior Vice President.