Moody's rates DIAL notes Ba2

Moody's Investors Service said it assigned a Ba2 senior secured rating to Delhi International Airport Ltd.'s (DIAL) proposed 10-year senior secured bond of up to $350 million.

The proceeds from the proposed bond will be used to help fund a major expansion to increase the passenger handling capacity of Indira Gandhi International Airport to up to 100 million passengers per year, which the company expects will cost up to Rp 98 billion over a three-year development phase, Moody's said.

The proposed bond's Ba2 senior secured rating reflects the airport's strong market position and robust passenger traffic, which will likely grow at a high single-digit percentage per annum over the next 18-months, the agency said.

The ratings are constrained by the company's planned capacity expansion, which will exert downward pressure on its financial metrics, Moody's said.

The ratings also are affected by the evolving regulatory environment in India and its obligation to pay 45.99% of its revenue to the Airports Authority of India as a concession fee, the agency said.

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