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Business Recorder
2 days ago
- Business
- Business Recorder
Moody's upgrades Wapda's CFR, BCA ratings
ISLAMABAD: Moody's Ratings (Moody's) has upgraded Pakistan Water and Power Development Authority's corporate family rating (CFR) to Caa1 from Caa2 and Baseline Credit Assessment (BCA) to caa1 from caa2. Concurrently, it changed the outlook to stable from positive. But at the same time expressed concern over its weak financial position and persistent operational challenges in Neelam-Jhelum power project. 'The upgrade of Wapda's CFR and the revision of outlook reflect the recent rating action taken on the government of Pakistan. This alignment underscores the strong credit linkage between Wapda and the sovereign, driven by the government's full ownership and direct oversight of the company, as well as Wapda's exclusive focus on domestic operations,' said Erman Zhang, a Moody's Ratings analyst. BCA also pushed up: Moody's upgrades Wapda's CFR to Caa2 This rating action follows the rating action on the government of Pakistan (Caa1 stable) on 13 August 2025. Wapda'sCaa1 CFR incorporates its caa1 BCA and Moody's assessment of a high likelihood of extraordinary support from, and the company's very high dependence on, the government of Pakistan when needed, under its Joint Default Analysis (JDA) for government-related issuers. Wapda'scaa1 BCA reflects its exposure to persistent operating challenges at its 969 megawatt (MW) Neelum-Jhelum power station (NJHP) and its weak financial profile due to its sizeable hydropower capacity expansion plan, its long receivables cycle and delayed tariff decisions. The BCA also considers Wapda's position in Pakistan's power sector as a dominant hydropower supplier, as well as the recurring financial support it receives from the government. The rating agency noted that the company's weak financial profile is the result of an unpredictable regulatory framework and its inability to sufficiently recover costs in a timely manner, leading to delayed tariff decisions and a long receivables cycle. Moody's projected that the Wapda's funds from operations (FFO) will remain very weak over the next 12-18 months, and a sustained recovery will depend on the regulator approving an increase in its tariffs as well as the operational resumption of NJHP. Moody's said that its assessment of Wapda's financial metrics is based on the combined financials of Wapda's power segment and Neelum Jhelum. The report said for the same reasons, WAPDA's liquidity will remain strained because of its substantial current borrowings and large capital spending. The company did not repay certain government loans as per the agreed repayment schedule, in part due to the delays in its recovery of outstanding receivables from its government-owned off-taker. Moody's expect this situation will continue. Operations at NJHP have been suspended since May 2024 because of weak pressure in the hydro project's tailrace tunnel. It is unclear when the project could resume operations or the repair cost required at present. During this period, NJHP will likely rely on recovery of outstanding receivables to meet its operating cash requirement, fund the repair cost and service its external debt. NJHP had previously shut down for 13 months after major cracks were discovered in its tunnel and had just resumed operations in September 2023. Moody's said expectation of a high likelihood of government support for Wapda considers the Pakistani government's full ownership and direct supervision of the company. It also reflects the company's strategic importance to the government as it is an important platform that (1) constructs and operates hydropower assets to supply affordable electricity in Pakistan, and (2) builds water storage facilities to help address the country's acute water challenges. However, such considerations are offset by the risks stemming from the government's low policy predictability and transparency. In addition, the financial challenges faced by the government, reflected in its Caa1 ratings, indicate its limited capacity to provide support to Wapda. The stable outlook on the rating mirrors the stable outlook on Pakistan's sovereign ratings, based on Moody's expectation that the relationship between Wapda and the government will remain intact at least over the next 12-18 months. Copyright Business Recorder, 2025
Economic Times
16-06-2025
- Business
- Economic Times
YES Bank shares in focus after Moody's upgrades rating to Ba2, outlook revised to stable
YES Bank shares will be in focus on Monday after international rating agency Moody's upgraded the lender's rating to Ba2 from Ba3 and revised the outlook to 'stable', citing improvements in its credit profile. Moody's also raised the bank's Baseline Credit Assessment (BCA) to ba3 from b1. ADVERTISEMENT "YES Bank's Ba2 deposit ratings are one notch above its ba3 BCA based on our expectation of a moderate likelihood of support from the Government of India (Baa3 stable) in times of need," Moody's said. Also Read: 10 midcap stocks with more than 20 buy Calls: Analysts see up to 25% upside Last week, YES Bank announced that the Reserve Bank of India (RBI) had approved a six-month extension for Managing Director and CEO Prashant Kumar, effective October 6, or until a new MD & CEO takes charge. Kumar's original three-year term ends in October, and the bank has initiated a global search for his successor. In May, Japan's Sumitomo Mitsui Banking Corp (SMBC) signed a definitive agreement to acquire a 20% stake in YES Bank through a secondary purchase. SMBC will acquire 13.19% from State Bank of India and 6.81% from other banks for Rs 13,483 crore, at a price of Rs 21.5 per share. SBI will offload its stake for Rs 8,889 crore, while the remaining Rs 4,594 crore will come from other banks including Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank, and Kotak Mahindra Bank. ADVERTISEMENT Also Read: These 11 Nifty microcap stocks can rally 55-210% in the next 12 monthsYES Bank share price target ADVERTISEMENT According to Trendlyne, the average target price for YES Bank is Rs 16, indicating a potential downside of nearly 18% from current levels. Of the 12 analysts covering the stock, most have a 'Sell' stock has risen 24% over the past three months but remains down 15% on a 12-month basis. The bank's current market capitalisation stands at Rs 63,227 crore. ADVERTISEMENT Also Read: Swiggy, Radico Khaitan among 7 stocks on which brokerages initiated coverage, see up to 34% upside (Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
16-06-2025
- Business
- Time of India
YES Bank shares in focus after Moody's upgrades rating to Ba2, outlook revised to stable
YES Bank shares will be in focus on Monday after international rating agency Moody's upgraded the lender's rating to Ba2 from Ba3 and revised the outlook to 'stable', citing improvements in its credit profile. Moody's also raised the bank's Baseline Credit Assessment (BCA) to ba3 from b1. "YES Bank's Ba2 deposit ratings are one notch above its ba3 BCA based on our expectation of a moderate likelihood of support from the Government of India (Baa3 stable) in times of need," Moody's said. Also Read: 10 midcap stocks with more than 20 buy Calls: Analysts see up to 25% upside Play Video Pause Skip Backward Skip Forward Unmute Current Time 0:00 / Duration 0:00 Loaded : 0% 0:00 Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 1x Playback Rate Chapters Chapters Descriptions descriptions off , selected Captions captions settings , opens captions settings dialog captions off , selected Audio Track default , selected Picture-in-Picture Fullscreen This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Text Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Transparent Caption Area Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Drop shadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Last week, YES Bank announced that the Reserve Bank of India (RBI) had approved a six-month extension for Managing Director and CEO Prashant Kumar, effective October 6, or until a new MD & CEO takes charge. Kumar's original three-year term ends in October, and the bank has initiated a global search for his successor. In May, Japan's Sumitomo Mitsui Banking Corp (SMBC) signed a definitive agreement to acquire a 20% stake in YES Bank through a secondary purchase. SMBC will acquire 13.19% from State Bank of India and 6.81% from other banks for Rs 13,483 crore, at a price of Rs 21.5 per share. SBI will offload its stake for Rs 8,889 crore, while the remaining Rs 4,594 crore will come from other banks including Axis Bank , Bandhan Bank , Federal Bank , HDFC Bank , ICICI Bank , IDFC First Bank , and Kotak Mahindra Bank . Also Read: These 11 Nifty microcap stocks can rally 55-210% in the next 12 months YES Bank share price target According to Trendlyne, the average target price for YES Bank is Rs 16, indicating a potential downside of nearly 18% from current levels. Of the 12 analysts covering the stock, most have a 'Sell' rating. The stock has risen 24% over the past three months but remains down 15% on a 12-month basis. The bank's current market capitalisation stands at Rs 63,227 crore. Also Read: Swiggy, Radico Khaitan among 7 stocks on which brokerages initiated coverage, see up to 34% upside ( Disclaimer : Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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Business Standard
13-06-2025
- Business
- Business Standard
Moody's upgrades Yes Bank rating to Ba2 citing improved credit profile
Moody's Ratings on Friday upgraded Yes Bank's long-term foreign currency and local currency bank deposit ratings by a notch to Ba2, from Ba3, driven by a gradual improvement in the bank's credit profile. The global rating agency has upgraded its Baseline Credit Assessment (BCA) to ba3 from b1, Moody's said in a statement. The upgrade of Yes Bank's ratings and BCA is driven by a gradual improvement in the bank's credit profile including its capital and loan loss reserves, which will provide sufficient buffers against the bank's unseasoned asset risks and improving yet modest profitability and funding, it said. "Yes Bank's Ba2 deposit ratings are one notch above its Ba3 BCA based on our expectation of a moderate likelihood of support from the Government of India (Baa3 stable) in times of need," it said. The bank's gross non-performing loan (NPL) ratio declined to 1.6 per cent, as of March 2025, from 13.9 per cent in March 2022. Reported provision coverage as a proportion of NPL increased to 80 per cent from 71 per cent during this period. Despite these improvements, it said, Yes Bank's asset quality remains exposed to unseasoned risks associated with the rapid expansion in its retail and small and medium enterprise portfolios, its increased focus into higher-risk retail segments, and reliance on third-party sourcing channels.
Time of India
13-06-2025
- Business
- Time of India
Yes Bank rating upgrade: Moody's lifts Yes Bank to Ba2 on stronger buffers, cites lower NPAs, better provisioning
Global credit rating agency Moody's Ratings on Friday upgraded Yes Bank's long-term foreign and local currency bank deposit ratings to Ba2 from Ba3, citing a gradual improvement in the bank's overall credit profile. The agency also raised Yes Bank's Baseline Credit Assessment (BCA) by one notch to ba3 from b1, reflecting better capital adequacy and strengthened loss-absorption buffers, Moody's said in a statement. 'The upgrade of Yes Bank's ratings and BCA is driven by a gradual improvement in the bank's credit profile, including its capital and loan loss reserves, which will provide sufficient buffers against unseasoned asset risks,' Moody's said as quoted PTI. The agency added that the bank's profitability and funding metrics are improving, albeit from modest levels. Yes Bank's gross non-performing loan (NPL) ratio dropped to 1.6% as of March 2025, a significant improvement from 13.9% recorded in March 2022. Over the same period, provision coverage as a proportion of NPLs improved to 80%, up from 71%, reflecting stronger asset quality buffers. Despite these gains, Moody's noted that the bank remains exposed to 'unseasoned risks' due to its rapid expansion into the retail and small and medium enterprise (SME) segments, increased focus on higher-risk retail lending, and its reliance on third-party sourcing for loan origination. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 3/4 BHK from ₹ 1.75 Crore*, Bengaluru Birla Estates Learn More Undo Moody's said the Ba2 deposit ratings are one notch above the bank's BCA of ba3, underpinned by the expectation of a moderate level of systemic support from the Government of India, which has a sovereign rating of Baa3 with a stable outlook. Yes Bank has undertaken a series of balance sheet clean-up and governance reforms since its reconstruction in 2020, following a Reserve Bank of India-led rescue plan backed by a consortium of Indian banks. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
