India Ratings Withdraws Sterling and Wilson Solar’s NCD and CP ratings; Maintains Other Ratings on RWN


Analytical Approach: Ind-Ra continues to analyse SWSL on a standalone basis without parent support. However, given that SPCPL continues to be the majority shareholder of SWSL, the rating of SWSL would remain linked to the credit profile of SPCPL and any material deterioration in the credit profile of SPCPL will be negative for SWSL’s ratings.



Ind-Ra is no longer required to maintain the NCD and CP ratings, as the agency has received a no-dues certificate from the investor of the NCDs and the issuer and paying agent of the CP.The RWN has been maintained due to the continued uncertainty regarding the credit strength of SPCPL (50.6% stake in SWSL). SWSL has short-term loans of INR8,040 million that would be due for repayment in 1HFY21. These loans were availed by the company prior to the event on 14 November 2019, where Sterling and Wilson Private Limited’s promoters had sought an extension for the repayment of intercompany deposits to the tune of INR23,410 million (excluding interest) as of September 2019 to SWSL. Subsequently, SWPL’s promoters facilitated the repayment of INR15,000 million of these loans to SWSL in December 2019 (INR10,000 million) and March 2020 (INR5,000 million). SWPL and its promoters expect to repay INR5,000 million of the balance to SWSL by end-June 2020 and the rest by end-September 2020. Ind-Ra will continue to monitor the progress of refinancing/rollover of the short-term debt alongside the progress on repayment of these intercompany deposits from SWPL. Ind-Ra is engaged in discussions with the management of SPCPL to understand the progress it has made on various fund-raising and asset-monetisation initiatives to create sustainable liquidity. The agency is likely to complete its assessment in a few weeks.

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The RWN indicates that the rating may be downgraded or affirmed. Ind-Ra expects to resolve the RWN on the basis of following:


·       the upcoming refinancing/rollover of the short-term debt

·       timely infusion of promoter support to SWPL and the consequent deleveraging of SWSL

·       the agency’s assessment of any material deterioration in SPCPL’s credit strength


SWSL was demerged from SWPL in March 2018.. The company is a leading global solar engineering, procurement, construction contractor with diversified presence across geographies.  SWSL was listed on the BSE Ltd and NSE Limited in August 2019. SPCPL owns 50.6% stake in the company; Khurshed Daruvala holds 25.7% stake, while the balance is held by the public.



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