Fitch rates NTPC notes BBB-

Fitch Ratings said it assigned an expected rating of BBB-(EXP)emr to NTPC Ltd.’s (BBB-/stable) proposed rupee-denominated senior unsecured notes that are payable in dollars.

The notes will be issued out of the $4 billion medium-term note program, which is rated BBB-.

The notes are denominated in rupees, but both the coupon payments and principal on maturity are settled in dollars at the prevailing rupee-dollar exchange rate. As such, settlements are subject to transfer and convertibility risk on exchange operations involving the Indian rupee, and thus the rating on the notes can be no higher than India's country ceiling of BBB-.

The notes are rated at the same level as NTPC's senior unsecured debt rating as they will constitute direct, unconditional, unsubordinated and unsecured obligation of NTPC, the agency said.

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