Fitch, Moody’s Downgrade RCom Credit Ratings, Bonds, Shares Slip

Fitch Ratings and Moody’s Investor Service on Tuesday downgraded Reliance Communications (RCom) for the second time even as the company received a seven months extension from bankers to repay the mounting debts.

Moody’s cut its rating to Ca from Caa1, suggesting that the debt is highly speculative and likely in, or very near, default, with some prospect of recovery of principal and interest.

Fitch Ratings has lowered RCom’s rating to RD from CCC and had previously cut its rating on June 2.

The company’s subsidiary GCX Limited also faced the heat as Moody’s earlier downgraded the company’s corporate family rating and senior secured bond rating from B2 to B3.

Bonds due 2020 were down 3 points to 67.5/71 cents on the dollar, losing about a third of their value since mid-May.

Whereas the stock of the company on the NSE is trading down by 3.4% at Rs 19.45 lower by Rs 0.7 per share at 1309 hours.

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