You are here: Home » Companies » News
Business Standard

Moody's changes JSW Steel's rating outlook to positive, affirms Ba2

Moody's Investors Service has changed the outlook on JSW Steel Ltd and Periama Holdings LLC's ratings to positive from stable.

Topics
JSW steel | Moody's

ANI 

jsw steel

Moody's Investors Service has changed the outlook on Ltd and Periama Holdings LLC's ratings to positive from stable.

It has also affirmed JSW's Ba2 corporate family rating (CFR) and its Ba2 senior unsecured notes rating.

At the same time, Moody's has also affirmed the Ba2 guaranteed backed senior unsecured rating on Periama Holdings LLC and the Ba2 rating on the 40 million dollar guaranteed revenue bonds issued by Jefferson County Port Authority.

Moody's has also assigned a Ba2 rating on the proposed notes to be issued by JSW in two tranches with one of the tranche proposed to be sustainability-linked senior unsecured notes.

"The outlook change to positive reflects our view that JSW's better-than-expected operating performance this fiscal year will help to sustain its deleveraging," said Kaustubh Chaubal a Moody's Vice President and Senior Credit Officer.

"We expect leverage -- measured by consolidated debt/EBITDA -- to decline to less than 2.0x by March 2022 from 5.9x at March 2020, 4.5x at March 2021 and 2.9x at June 2021," he said.

"We also forecast that the company will continue to generate large and positive free cash flow from operations over the next 12 to 18 months because of supportive steel prices and steady product spreads amid likely continued strong steel demand," added Chaubal who is also Moody's lead analyst for JSW.

The rating action is also supported by the sustainable improvement in JSW's liquidity profile.

Moody's projects JSW will incur an estimated two billion dollars in annual capital expenditure (excluding acceptances payment) towards investments in downstream facilities, plant upgrades and brownfield capacity.

Still, large EBITDA generation and tight working capital management should enable sufficient free cash flow generation.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Mon, September 13 2021. 12:44 IST
RECOMMENDED FOR YOU
.