CARE Ratings on February 17 downgraded its rating of Vodafone Idea's Non-Convertible Debentures (NCDs) and long-term bank facilities.
According to a release filed with exchanges, the ratings agency revised its rating on both these instruments to BB- (credit watch with negative implications), down from BBB- (credit watch with negative implications).
The rationale behind the downgrade was that the ratings agency saw a significant erosion in the overall risk profile of the company.
CARE Ratings took cognizance of the financial impact of no relief being granted on the modification plea by telecom companies on February 14 that sought a new schedule of Adjusted Gross Revenues (AGR) dues.
The development comes after the board of Vodafone Idea, on February 17, authorised the company to immediately pay the Department of Telecommunications (DoT) Rs 2,500 crore as a portion of the dues on AGR.
The DoT on February 14 had ordered telecom companies like Bharti Airtel and Vodafone Idea to clear their AGR dues on the same day before midnight.
The DoT calculated that Bharti Airtel, Vodafone Idea and others owe as much as Rs 1.47 lakh crore in past dues, including penalties and interest, while non-telecom firms, who had taken some licence from it, owed another Rs 2.65 lakh crore.
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