Rationale report states that the ratings continue to factor in the strength of the promoter group, company’s long-term experience in the power sector, long-term power purchase agreements (PPAs) for ~82% of the company's consolidated total power generation capacity for the existing business profile and significant deleveraging over the past few years.
The Positive outlook is on account of the improvement in gross debt/Ebitda and net debt/Ebitda ratios in FY20/9MFY21, and the likely sustenance of the same, and profitability, as well as the receivables level, post factoring in the planned capex. Adherence to implementation timelines within budgeted costs for the proposed expansion and tying-up of PPAs as per committed timelines would be a key monitorable.
JSWEL was incorporated in 1994 and is the power utility arm of JSW Group. The promoter and promoter group companies had a total of 74.87% shareholding in the company at the end of December 2020.