RBI Cash, Yields Draw Investors to Dollar Bonds: India Credit

(Bloomberg) -- Bargain-hunting investors are increasingly moving into Indian dollar bonds, and central bank support unveiled Wednesday may further that trend even as the nation grapples with a tragic surge in Covid cases.

Primary Issuance -- Going Green

• Indian firms have issued a record $3.4 billion green dollar bonds so far this year, Bloomberg-compiled data shows. JSW Hydro Energy Ltd. plans to further boost such sales and join six other borrowers, including Greenko, ReNew Power and Continuum Energy
• JSW Hydro began investor calls for a green note Tuesday. The company, rated a notch higher than its renewable peer Azure Power Solar Energy Pvt., plans to issue notes primarily to repay its debt on two projects, Fitch Ratings said in a note

• Meanwhile, rupee bond issuance is off to a slow start this week. Local firms have sold 11.4 billion rupees of notes as of Wednesday and plan to sell as much as 27.25 billion in the remaining week. If they did, that would still be less than half of the 80.2 billion worth of notes sold last week

Secondary Market -- Lockdown Fallout

• “India’s second Covid wave could knock off as much as 2.8 percentage points from GDP growth in fiscal 2022, derailing what has been a promising recovery in the economy, profits, and credit metrics in the year to date,” S&P Global Ratings analysts including Eunice Tan and Shaun Roache wrote in a note Wednesday
• Still, S&P Global Ratings expects the credit profile of Indian companies to likely be resilient to the second wave of infections as most of them have improved liquidity and better access to funding than during the first wave
• Global credit research firm CreditSights changed its recommendation last week on Indian Oil Corp., Reliance Industries Ltd. and Shriram Transport Finance Co. to underperform, citing the headwinds that the firms will face due to lockdowns
  • CreditSights also changed its view on Delhi International Airport Ltd. to negative from neutral as the resurgence in Covid cases will likely suppress passenger traffic

Credit Ratings -- Future Retail

Distressed Debt -- Reliance Communications

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