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ICRA Assigns AA(SO) Rating to GMR Jadcherla`S NCD Issue

  • ICRA has assigned a Conditional Rating of [ICRA]AA(SO) to the proposed Rs. 320 crore Non-Convertible Debentures (NCDs) to be issued by GMR Jadcherla Expressways Private Limited (GJEPL).The NCDs shall be credit enhanced by an unconditional and irrevocable First Loss Default Guarantee from IIFCL to the extent of 24% of the NCD amount. Commenting on the significance of the Rating assignment, Mr. Naresh Takkar, Managing Director & CEO, ICRA Limited, said: "Credit enhancement is an innovative scheme introduced by IIFCL, which is expected to lead to an improvement in credit ratings of infrastructure projects, and consequently, improve the marketability of the debt/bonds issued by the project company. " He added, "We expect credit enhanced ratings of infrastructure projects to pave the path for the participation of Insurance companies and pension funds in this sector. Besides, refinancing would also free up funds for commercial banks, which in turn could be used to finance newer infrastructure projects."

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