Even as Dewan Housing Finance Corporation (DHFL) continued to see downgrades, rating agency Icra on Tuesday said payouts by the financier were delayed despite funds being available in some instances.
Late Monday evening, Crisil lowered its rating on DHFL commercial papers (CPs) worth Rs 850 crore to A4+ from A3+. It observed that DHFL s liquidity levels are deteriorating because of further delays in fundraising from the sell-down of project finance loans and lower inflows from securitisation of non-housing loans.
Close to Rs 1,500 crore of the DHFL s debt instruments have been downgraded this week.
On Tuesday, Icra carried out a fresh round of downgrades, lowering its rating on purchaser payouts and pass-through certificates (PTCs) issued under six mortgage loan securitisation transactions worth Rs 630 crore.
While Crisil ascribed its rating action to a more-than-expected reduction in the company’s liquidity , Icra observed that the downgraded loan pools were performing well in terms of collections till March 2019.
Icra notes that there were sufficient funds available with the Trustee (in the form of cash collateral) for meeting the scheduled PTC payouts on the due date. However, it was not utilised by the Trustee, the agency wrote in its rating rationale.
Analysts at Icra added that though the company attributed the delay to technical or administrative issues, they were unable to independently verify this claim.
The Crisil report, while pointing to other risks such as higher-than-scheduled liability repayments and heightened additional risk of unscheduled early redemption of non-convertible debentures (NCDs), had noted: Additionally, Crisil notes that DHFL, as a strategic decision, did not resort to securitisation of readily available housing loans to prop up the liquidity levels.
DHFL s liquidity profile is unlikely to improve anytime soon as there is low visibility regarding timely fundraising. Liquidity dropped to `2,775 crore as on April 30, 2019, including statutory liquidity ratio (SLR), analysts at Crisil said. On the other hand, scheduled aggregate cash outflows, including loan repayment and securitisation payouts, till July 2019 are estimated at a much higher `8,400 crore.
DHFL continues to be on rating watch with negative implications at Crisil. Earlier, Icra had also downgraded DHFL s CP programme to A4 from A3+ and placed it on watch with negative implications .
On Tuesday, DHFL s shares ended at `117 on the BSE, 5.45% higher than their previous close.