Russia-linked Indian refiner put under credit watch, CARE Ratings says

CARE Ratings

07/03/2022 09:14

By Nidhi Verma
    NEW DELHI, March 7 (Reuters) - India's CARE Ratings Monday
said it has placed the long-term ratings of Indian refiner
Nayara Energy, part owned by Russia's Rosneft  ROSN.MM , on
'credit watch with negative implications' due to sanctions
against Moscow for its invasion of Ukraine.
    Oil major Rosneft owns a 49.13% stake in Nayara while a
similar-sized holding is split between global commodities
trading house Trafigura and Cyprus-based Russian investment
group United Capital Partners.
    CARE has put the ratings of Nayara's long term bank loan of
171.5 billion rupees ($2.23 billion) and non-convertible
debentures of 25.42 billion rupees under credit watch with
negative implications, it said in a statement. 
    Nayara operates the 400,000 barrel-per-day (bpd) Vadinar
refinery in India's western Gujarat state and has a fleet of
about 6,500 retail fuel stations in the country.
    Reuters last week reported that Nayara will find funding
harder due to its link with Russian entities.  urn:newsml:reuters.com:*:nL2N2V620G
    CARE Ratings said it would continue to monitor the situation
and would take action on the rating in case of any adverse
impact of the war on Nayara's shareholders and the Indian
company.
    The rating agency however said Nayara is not at present
impacted by western sanctions against Russia as it buys oil from
producers in the Middle East, Egypt and Latin America and
exports most of its refined fuels to the Netherlands and Far
East. 
    "Nonetheless, given the severity of the war situation and
the resultant global backlash by way of sanctions on Russia and
certain Russian entities, there is a lot of uncertainty over the
exact ramifications of the situation on Nayara's shareholders".
    In 2020, Didier Casimiro, the former president of Rosneft
Trading S.A., had to resign from the board of Nayara after he
was placed on a sanctions list by the United States.
    
    ($1 = 76.9130 Indian rupees)

 (Reporting by Nidhi Verma; Editing by Frank Jack Daniel)
 ((nidhi.verma@thomsonreuters.com; +91 11 49548031; Reuters
Messaging: nidhi.verma.thomsonreuters.com@reuters.net))