Crisil upgrades ratings on Tata Tele's Rs 5,166 crore bank loan facilities

Citing "strong support" expected from Tata sons and TTML as bases, the credit rating agency Crisil on Wednesday upgraded the ratings on Tata Teleservices (Maharashtra) Ltd's bank loans facilities of Rs 5,166 crore to CRISIL AA-/CRISIL A1+ from CRISIL A/CRISIL A1.

"Crisil has upgraded its ratings on the bank loan facilities of Tata Teleservices (Maharashtra) Ltd (TTML) to CRISIL AA-/CRISIL A1+ from CRISIL A/CRISIL A1," TTML said in a regulatory filing. Crisils AA rating indicates high degree of safety regarding timely servicing of financial obligations.

The ratings have been removed from watch with developing implications and a stable outlook has been assigned to the long-term facilities, the rating agency said in a statement.

Tata Sons intends to invest Rs 20,000 crore in Tata Tele (against the earlier plan of Rs 14,000 crore) that will be used primarily for repaying debt. The remaining bank debt is expected to be refinanced through debt instruments of short to medium term maturity, the statement said, adding that Tata Sons will work with Tata Tele in case the latter needs to arrange for any shortfall in liquidity that may be required for on-time debt repayment.

"Crisil had placed its ratings on Tata Tele on Watch with Developing Implications on October 17, 2017, following announcement by TTML to combine Tata Teles consumer mobile business with Bharti Airtel," it noted.

Tata Tele has also announced plans of divesting its enterprise, and fixed line and broadband businesses to group companies. "Crisil has received clarity over likely timelines for divesting the consumer mobile and other businesses, and the overall debt reduction plan, and believes Tata Sons' continued support will enable Tata Tele to meet external liabilities in a timely manner," the statement said.

With PTI inputs