Credit rating agency, CRISIL has downgraded its ratings on the debt programmes and bank facilities of DLF to A Negative/ A2+ from A+ Stable/ A1 respectively.
The downgrade has been driven by the company’s high debt levels resulting in weak debt protection metrics, and susceptibility to risks and cyclicality inherent in the real estate sector.
DLF’s debt levels will remain higher than CRISIL’s earlier expectations because of delay in divestment of non-core assets. However, in the six months ended September 30, 2011, the company achieved divestments of only around Rs 400 crore; its reported gross debt levels have also gone up to Rs 25500 crore as on the same date, from Rs 24000 crore as on March 31, 2011.
