Mahanagar Telephone Nigam Limited ( (IN:MTNL) ) has issued an update.
Mahanagar Telephone Nigam Limited has disclosed that Crisil Ratings has maintained its AAA (CE) rating with a ‘watch negative’ status on MTNL’s Rs 6,520 crore of government‑guaranteed bonds and debentures, reflecting continued concern over past lapses in a structured payment mechanism. Although all bond obligations have been met and the government has recently been funding the escrow accounts on or before the key trigger date, prior delays, MTNL’s liquidity challenges, and the slippage of a major loan with Bank of India into non‑performing status keep the rating under watch, with any further process failures potentially leading to a downgrade.
Crisil’s stance underscores that the rating is driven primarily by the Government of India’s unconditional and irrevocable guarantee and a trustee‑administered payment mechanism, rather than MTNL’s standalone financial strength. The agency is awaiting clarity from MTNL on steps to ensure strict compliance with the T‑structure payment timelines, and signals that sustained adherence could see the negative watch resolved, while renewed non‑compliance in upcoming repayments would heighten risk perceptions for bondholders and other stakeholders.
This story was written using TipRanks’s AI tools and reviewed by a TipRanks editor.
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