Ind-Ra affirms long-term issuer rating on ITNL for tight liquidity position

India Ratings and Research Wednesday said IL&FS Transportation Networks continues to face tight liquidity position amid delay in realisation of pending claims. The rating agency affirmed its long-term issuer rating at 'IND D' on IL&FS Transportation Networks (ITNL), a group company of IL&FS.

Instruments with IND D rating are in default or are expected to be in default soon. The rating affirmation reflects continued delays in debt servicing by the company owing to a tight liquidity position, resulting from delay in realisation of pending claims from various government authorities and delays in undertaking deleveraging initiatives, Ind Ra said in a statement.

ITNL in March informed the bourses that it has defaulted on payment of Rs 20.91 crore due on principal and interest of non-convertible debentures because of insufficient funds. The principal amount and interest due and payable on March 18, 2019, was not paid to the debenture holders due to insufficient funds, the company had said.

Some group companies of IL&FS have defaulted on many debt instruments in the past few months due to insufficient funds. The Group's total debt stood at over Rs 90,000 crore as of October 2018. In December last, the Group announced the sale of equity stakes in its road assets to raise funds and initiated the process of exploring divestment of IL&FS Group's equity stakes in road assets.