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Rating agency ICRA has reaffirmed IndiGo's long-term rating at A-plus with a negative outlook but downgraded short-term rating by one notch from A1-plus to A1.
The agency has acknowledged India's largest airline's strong market position, cost-efficient structure and robust liquidity profile among its peers.
However, it attributed the downgrade of the company's short-term rating to the unprecedented disruptions caused by Covid-19 pandemic and its consequential impact on the global and domestic demand for air travel.
While the airline industry is going through an unprecedented crisis, said ICRA, the company's balance sheet remains strong.
The company had total cash reserves of Rs 18,450 crore and a free cash reserve of Rs 7,526 crore as on June 30. IndiGo has taken a number of actions to cut costs and is further working on a number of short-term measures to boost its liquidity, said ICRA.
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