Reliance Capital’s rating downgrade puts its $5 billion debt at risk, says report

Anil Ambani-led Reliance Capital Ltd.’s downgrade to default grade at Care Ratings Ltd. not only places the debt of embattled tycoon’s conglomerate at risk but it also reignites India’s credit scare, reported Bloomberg.

The development, the report said, comes after the Mumbai-based Care cut Reliance Capital’s bonds by eight notches, taking it from BB to D. The rating agency cited a delay in coupon payments on several of the lender’s non-convertible debentures (NCDs) as the reason for its downgrading, the report said.

Earlier, Reliance Capital had stated that its debt stood at about $5 billion as of September. It had said in an exchange filing that the delay in coupon payments was caused by a “technical glitch in bank servers", said the report.