Jet Airways executives will meet credit ratings agency ICRA, following the downgrade of its debt rating to ‘D’ from ‘BB’ after the airline failed to meet loan repayment schedule, as reported by Economic Times.
According to ICRA’s rating scales, “instruments with ‘D’ rating are in default or are expected to be in default soon.” “Indeed Jet has been downgraded to ‘D’ rating because of cases of defaults. We have been informed of the same by financial institutions and the airline’s auditors,” said Naresh Takkar, managing director and chief executive officer of the agency. He didn’t elaborate on the amount Jet had defaulted on.
The rating may make it difficult for the cash-strapped airline to raise additional loans. It recently raised US$150 million worth of soft loans with help from its strategic partner Etihad Airways. In its annual report for the last fiscal year, there were mentions of defaults worth Rs 90,860 crore for 30 days, Rs 20,502 crore for 30-60 days and Rs 22,245 crore for 61 days and beyond.