CARE has placed the ratings of JSW Energy Limited (JEL), JSW Energy (Barmer) Limited, JSW Hydro Energy Limited, Jaigad Power Transco Limited, Barmer Lignite Mining Company Limited and JSW Power Trading Company Limited on 'Credit watch with negative implications' on account of recent announcement of proposed acquisition of thermal power assets of GMR Kamalanga Energy Limited (GKEL, rated CARE D) which owns and operates a 1,050 MW thermal power plant in Odisha and approval of JEL's resolution plan submitted for Ind-Barath Energy (Utkal) Limited (IEUL, rated CARE D; Issuer Not Cooperating) by the Committee of Creditors. The closure of the transaction shall be subject to the receipt of necessary regulatory approvals and clearances from respective competent authorities.
CARE in light of the above events is engaging with management to understand its implications on overall financial risk profile of the company and its group/associate companies. As per the initial discussion with the management, CARE understands that these acquisitions might be largely debt funded. As a result of this, overall gearing ratio of the company at consolidated level might increase significantly from 0.78 times as on March 31, 2019.
CARE continues to take consolidated approach while arriving credit profile of JEL. Further, the credit risk profile of group/associate companies of JEL might be impacted in case of upstreaming of free cashflows or availing of additional debt at group/associate companies level.
CARE would be monitoring closely and evaluate the impact of the above developments on the credit quality of JEL and its group/associate companies and would take a view on the rating when the exact implications of the above are clear.
Shares of JSW Energy Ltd was last trading in BSE at Rs.66.5 as compared to the previous close of Rs. 64.65. The total number of shares traded during the day was 76694 in over 1006 trades.
The stock hit an intraday high of Rs. 66.5 and intraday low of 63.35. The net turnover during the day was Rs. 5023623.