Reliance Industries: Fitch revises ratings

Rating agency Fitch Ratings has revised the outlook on Reliance Industries Limited's (RIL) long-term local-currency Issuer Default Rating (IDR) to positive from stable and has also affirmed the rating as 'BBB'.

Fitch Ratings also affirmed the company's long-term foreign-currency IDR at 'BBB-' with a stable outlook.

The local-currency IDR outlook has been revised due to RIL's potential to further deleverage after announcing that the company plans to eliminate its net debt before the end of financial year March 2021 i.e., FY21. RIL also announced its plan to sell 20 per cent stake in its oil-to-chemical unit to Saudi Aramco, which is a Saudi Arabian Oil Company having a stable outlook and 'A+' rating. 

RIL's adjusted net Debt/EBITDAR is forecast to reach over 1.5x in the coming 18 to 24 months, stated the rating rationale. 

Headquartered in Mumbai, Reliance Industries Limited is an Indian multinational conglomerate company having business operations across various sectors such as energy, petrochemicals, textiles, natural resources, retail, and telecommunications. The company benefits from its vertically integrated business model thus dominating market position in petrochemicals, refining, etc. RIL's digital service business, Jio is also continuing to grow and has managed to achieve a huge customer base.

On Friday, the stock of RIL closed at Rs. 1,277.4, down by 0.85 per cent or Rs. 10.9 per share. Its 52-week high is at Rs. 1,417 and 52-week low is at Rs. 1,017 on BSE.