Moneycontrol BureauRating agencies upgraded the debt of 138 companies last month while downgrading that of 94 firms, ending a 16-month-long trend of more downgrades than upgrades, according to a report in The Financial Express.
The report said, however, said this trend does not necessarily mean that the financial health of corporate India has improved, given that the pattern was broken more because of downgrades falling rather than upgrades rising.
There had been a massive jump in the number of downgrades in December, the month after the government decided to do away with 86 percent of the currency in circulation in a bid to crack down on black money.
The report quoted the head of a corporate ratings agency as saying that it was possible that his peers had indulged in “pre-emptive strikes” in November and December, given that the central bank had not given corporate borrowers an additional 90 days to service their loans after the note ban.
Top names such as Lodha Developers, Reliance Communications, and Tata Steel were downgraded in January. While Lodha was downgraded owing the effect of demonetisation, the other two companies suffered because of being overleveraged.
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