S&P withdraws rating of Indian Oil on request
New Delhi: The global rating agency, Standard & Poor`s, on Tuesday said it has withdrawn rating assigned to oil marketing major Indian Oil Corporation on the company`s request.
"The rating was... withdrawn at the company`s request," S&P said in a release.
S&P has earlier revised upwards the rating outlook of IOC from negative to stable due to improvement in the liquidity position of the company and continued support from the government.
Stable means that a rating is not likely to change while negative denotes that the rating may be lowered.
"The outlook revision reflects IOC`s improving standalone credit profile as a result of a strengthened liquidity position and ongoing support from the government of India," the rating agency said in a release.
At the same time, it has retained the BB+ long-term corporate credit rating on the company. BB indicates the least degree of speculation.
"The affirmed rating on IOC reflects the effect on the company from the government`s control of fuel prices, combined with the lack of an institutionalized mechanism to receive timely compensation for under recovery of crude oil costs," S&P said.
The rating agency also said that there is an "extremely high" likelihood of extraordinary government support for IOC in the event of financial distress.
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