Moody's Ratings assigns Baa3 rating to NHPC, outlook stable

New Delhi: NHPC's Baa3 rating reflects its BCA of ba1, the high level of extraordinary support from, and the company's very high level of dependence on, the Government of India (Baa3 stable) under Moody's Joint Default Analysis (JDA) approach for government-related issuers (GRIs).

"NHPC's BCA reflects the company's strong competitive position, the favourable policy and regulatory environment for India's hydropower sector," says Abhishek Tyagi, Moody's Vice President and Senior Credit Officer.

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"The BCA also incorporates the implementation risk associated with the company's large and complex capital spending program and its high financial leverage, which constrains its BCA," adds Tyagi.

NHPC is India's largest hydropower generator with a long track record of developing projects. It is also one of India's lowest-cost electricity producers, which underpins its strong competitive position in the industry.

The stable rating outlook reflects Moody's expectation that NHPC will continue to generate relatively predictable cash flow in its regulated power business despite the large planned capital expenditure program.

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NHPC Limited was established in 1975 and is India's largest hydropower generation company with an installed capacity of 7,097 megawatts (MW), including 6,971 MW from 22 operational hydro projects and 126 MW from solar and wind projects.

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