India Ratings and Research (Ind-Ra) has maintained a Stable rating outlook for the overall infrastructure sector for FY25.

While maintaining a “Positive” rating outlook on airports, Ind-Ra has revised the rating outlook for thermal assets to “Stable” from “Positive”, and wind assets to “Stable” from “Negative” for FY25.

The Stable rating outlook on the infrastructure sector factors in the likelihood of a stable operating performance for most projects, long-term revenue visibility under concession agreements and power purchase agreements (PPAs), and expected improved cargo and traffic volumes.

The rating agency observed that growth in electricity demand leading to increased thermal asset utilisation and improved airport traffic volumes are positives. Adequate internal liquidity and timely payments from counterparties remain key monitorables.

Furthermore, the impact of a potential rise in the interest rates owing to the proposed increase in provisioning norms on the cost of borrowing for infrastructure projects remains monitorable for projects with thin debt coverages.

Energy Infrastructure

Ind-Ra expects power demand to remain strong in FY25, with improved economic activity and above-normal temperatures expected during the ongoing summer season. The agency expects the same to be about 7 per cent year-on-year/yoy in FY25.

The country added an aggregate capacity of around 26GW in FY24, the highest since FY16, largely due to solar and thermal.

Following the introduction of LPS (late payment surcharge) Rules 2022, receivables in solar, wind and thermal plants in Ind-Ra’s portfolio have reduced significantly, with payments against the current bills being received within 90 days from majority of the discoms.

Ind-Ra emphasised that improved liquidity demonstrated adoption of LPS Rules 2022 and sustained timely payment receipts are positives for energy sector ratings. Compared to counterparties’ strength and diversification, internal liquidity is a key rating factor for all generation assets.

Toll Roads

The agency noted the economic growth expectation and adequate coverage back toll roads.

It expects toll collection growth to moderate to 6-7 per cent in FY25, compared to double-digit growth seen in FY23 and FY24, even as the impact of traffic from new roads is a key monitorable.

Annuity Roads

Ind-Ra has maintained a Stable rating outlook on projects based on a hybrid annuity model for FY25. This is because of sustained high competition, a significant chunk of projects won by a new sponsor in either the under-construction or pre-appointment date stage, persisting land-related issues, and lower awarding activity in FY24 and 1HFY25.

All these factors could cause developers to bid aggressively for projects, leading to a build-up of stress in the sector. 


Ind-Ra said the continued Positive outlook for airports is based on steady traffic growth and improving non-aero revenues.

The agency expects the prevailing high leverage ratio for rated operating airports to taper down in the next two to three years after t a new tariff order. is implemented

It also expects the overall growth in passenger traffic to be 10-12 per cent, driven by an improvement in regional connectivity in India after the introduction of the UDAN scheme and robust passenger growth in metro airports. 

The agency noted that the government’s focus on developing greenfield airports has become a driving force of growth, facilitating the addition of significant capacities.

The government has so far accorded in-principal approval for setting up 21 greenfield airports, of which 12 airports have been operationalised.

Ind-Ra opined that developing these greenfield airports is expected to cater to the increased demand for air travel in many cities.

 Sea Ports

 Ind-Ra has maintained a Stable rating outlook for sea ports for FY25, supported by a moderate demand in external trade.

It added that the Red Sea crisis had no material impact on Indian trade between November 2023 and March 2024, as alternative routes such as the Cape of Good Hope or even land routes were explored to circumvent the impacted transit route, it added.

The agency expects merchandise exports and imports growth to remain stable in FY25.

It expects cargo volume growth (major and non-major ports) to remain close to 7 per cent yoy with expected throughput at Indian sea ports cumulatively reaching 1,645MTPA (million tonnes per annum) in FY25.

Electric Buses

The Stable rating outlook for electric buses follows an adequate delivery, sponsor support, and operational track record post-commissioning.

Debtor days are comfortable for Ind-Ra-rated entities, though with some instances of interim delays.

The counterparty profile and the payment profile of counterparties will drive the ratings. The agency said idiosyncratic risk in the electric bus sector could be a pain point.