Global ratings agency, Fitch Ratings, Singapore has affirmed the Adani Group’s ports arm Adani Ports and Special Economic Zone Limited (APSEZ)’s long-term foreign-currency Issuer Default Ratings (IDR) at ‘BBB–’ with ‘stable’ outlook on the company.
The agency has also affirmed APSEZ’s senior unsecured rating at ‘BBB-’ and the ‘BBB-’ rating on its $650-million 3.5 per cent senior unsecured note due 2020, the company informed in a stock exchange filing.
On the ratings, Karan Adani, Chief Executive Officer of APSEZ, said: “Fitch’s BBB- Stable Outlook to APSEZ is a testimony to our overall strength in the infrastructure space and our leadership position in the Ports Sector.”
The rating of BBB- Stable (Investment Grade) by Fitch has been affirmed based on Robust Business Model, strong market position and management’s commitment for reduction in related party loans and advances, it said.
Fitch sees APSEZ as being well-positioned to benefit from India’s growth and related cargo opportunities and it estimated company’s growth at 14 per cent (CAGR) with improved profits and positive cash flows.
“APSEZ is committed to recover the related party loans and advances gradually.”
“The company, unlike some other rated peers in the region, has significantly better flexibility in infrastructure renewal and expansion capex, which gives it the ability to generate strong free cash flows as mentioned by Fitch in their press release given today,” the statement said.
The rating will enable APSEZ to continue to tap international markets for long term and low cost funds.