India’s DISCOM Ratings Show Signs of Improvement on Paper

India’s DISCOM Ratings Show Signs of Improvement on Paper

The Ministry of Power (MoP) recently released its seventh annual integrated ratings for the state distribution companies (DISCOMs). The Investment Information and Credit Rating Agency (ICRA) and Credit Analysis and Research (CARE) were the designated rating agencies. This year DISCOMs saw a significant increase in rating upgrades; there were 20 upgrades and only one downgrade.

The upgrades were broadly attributable to the fact that 28 of the rated power distribution entities have shown an improvement in their aggregate technical & commercial (AT&C) loss levels during FY 2018 (19 over the previous year), filed timely tariff petitions for FY 2020, and demonstrated greater cooperation in terms of submission of information and facilitating meetings and discussions.

Also, regulatory clarity is gradually appearing in the state power sector with state electricity regulatory commissions in place across all 22 states covered by ICRA and CARE. Read More

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