Moody's has placed on review for downgrade the 'Baa3' issuer and senior unsecured rating of Bharti Airtel.
Shares of telecom operator Bharti Airtel slipped 5.2 percent in the early trade on Friday after Moody's Investors Service placed company's rating on review for downgrade, following low levels of profitability and expectation of weak cash flow.
Moody's has placed on review for downgrade the 'Baa3' issuer and senior unsecured rating of Bharti Airtel and the ratings on the backed senior unsecured notes issued by Bharti's wholly-owned subsidiary, Bharti Airtel International (Netherlands) B V, the US-based agency said in a statement.
'Baa3' is the lowest investment-grade bond ratings, and any downgrade would put the rating in speculative grade.
"The review for downgrade is primarily driven by our expectation that Bharti's cash flow generation will remain weak and leverage elevated," Moody's VP and Senior Credit Officer Annalisa DiChiara said.
The review also reflects the company's low levels of profitability, particularly from its core Indian mobile operations, negative free cash flow and higher debt levels to fund capital spending, it said.
At 09:17 hrs Bharti Airtel was quoting at Rs 294.80, down Rs 11.15, or 3.64 percent on the BSE.
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