Moody's cuts outlook for Indian power sector amid coronavirus-induced stress

According to the agency, power demand in April slumped by over one-third of the usual demand during the month as the nationwide lockdown significantly reduced industrial and commercial activity.

PTI

May 15, 2020 / 15:45 IST

Moody's Investors Service on Friday cut its outlook for the Indian power sector to negative as it expects power demand to drop at least 4 to 5 percent in fiscal 2021 due slowing activity and policy actions amid coronavirus-induced pressure.

According to the agency, power demand in April slumped by over one-third of the usual demand during the month as the nationwide lockdown significantly reduced industrial and commercial activity.

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“Moody's Investors Service has changed its outlook for the Indian power sector to negative from stable on declining power demand, payment delays and an adverse impact from government measures that favour consumers over utility companies," the agency said in a statement.

Power demand will drop at least 4-5 percent in fiscal 2021 due to slowing activity and policy actions. Companies are vulnerable to policy moves and payment delays from state-owned distributors, it noted.

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