In order to finance infrastructure projects, India Infradebt is in the process of issuing Rs 500 crore worth of debenture. The debenture was assigned AAA/Stable rating by CRISIL.
ICICI Bank, Bank of Baroda, Life Insurance Corporation of India and Citicorp Finance (India) jointly promoted Infradebt as an infrastructure debt fund (IDF) in the non-banking financial company route.
Crisil said it had a stable outlook on the company, adding it believed Infradebt would benefit from a prudent management policy. The agency, however, said the outlook may be revised to negative in case of a significant deterioration in the company’s asset quality.
Meanwhile, Pawan Agrawal, Senior Director of CRISIL Ratings expects IDF-NBFCs to facilitate the development of the bond market by providing a good investment opportunity for long-term bond investors in high-quality paper, aligned with their risk appetite and time horizon.
But some analysts feel that Infradebt may face operational risks relating to scale-up of business, and legal risks associated with the tripartite agreement as the concept of IDF-NBFCs is at a nascent stage.
Crisil also said it believed policy makers would continue to play a supportive role, given the potential of IDF-NBFCs in the infrastructure financing domain.