Listed firms managing liquidity challenges well, says India Ratings

Given the tightening liquidity conditions and higher cost of borrowings, corporates with a weak credit profile are likely to tap a loan against shares facility to meet their funding requirements

The listed entities are managing its liquidity challenges well despite rising inflation, slowing export demand and tightening fund conditions in the system, according to the India Ratings and Research (Ind-Ra).

There are pockets of stress building-up in 11 entities wherein 50 per cent or more shares held by the promoter or promoter group entities were pledged as of Q1FY23 (June 2022) and liquidity is tagged as stretched/poor across rating agencies.

Ind-Ra said the five investment grade ratings wherein the liquidity is tagged as stretched are rated in the BBB category. Other six entities are rated below investment grade. It, however,