Moody's warns of downgrading Tata Motors
Mumbai: Moody's Investors Service has placed the ratings on Tata Motors on review for a possible downgrade. The review, which will be completed over t...
Mumbai: Moody's Investors Service has placed the ratings on Tata Motors on review for a possible downgrade.
The review, which will be completed over the next 90 days, is on the Ba3 corporate family rating and Ba3 senior unsecured debt rating, Moody's said in a statement. The outlook on ratings under review has been revised from negative, Moody's said.
"We expect to conclude the review within 90 days," based on a review of the impact of Covid-19 on the operations of Tata Motors, including its supply chains; impact on demand in key global markets and government's containment measures including some government support as well as its countermeasures and liquidity profile. On the rationale for a possible downgrade, Moody's cited the rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines, which are creating a severe and extensive credit shocks across many sectors, regions and markets.
"The combined credit effects of these developments are unprecedented. The automotive sector has been one of the sectors most affected by the shocks given its sensitivity to consumer demand and sentiment," it said.