NTPC's rating unaffected by govt's stake sale: Moody's

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26 Aug, 2025 12:21

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The government's 5 percent stake sale in NTPC will not impact the rating of the country's largest power producer, Moody's Investors Service said today.

NTPC's rating remains supported by its strategic importance to the Indian economy, given its position as India's largest power generation company, Moody's said in a statement.

Moody's has a 'Baa3' rating on NTPC with a positive outlook.

"We expect the government to maintain its majority stake in the company even after the sale of 5 percent stake which, as such, does not affect our assessment of sovereign support for NTPC," said Abhishek Tyagi, V-P and Senior Analyst, Moody's.

The government is selling 5 percent stake in NTPC through the two-day offer for sale (OFS) route. After the sale, the government will continue to hold a majority stake of 69.96 percent in the firm.

NTPC stake sale is part of the government's disinvestment programme through which it aims to raise Rs 69,500 crore in the fiscal year ending March 31.

"We will reassess the level of government support incorporated in the company's ratings only if the government's shareholding falls below 50 percent or if there are other indicators of a change in the relationship between the government and NTPC," Tyagi said.

Moody's, however, said NTPC's rating could come under downward pressure if there are unfavourable regulatory developments such as tariff reductions, which could negatively affect the company's financial position.

Furthermore, a rating downgrade could result if the government reduces its interest in NTPC to below 50 percent or any indication of weakening government support.