Fitch Ratings has said that the credit ratings of Indian power generation companies (gencos) are expected to remain stable in the near term, supported by favorable regulatory frameworks and ongoing government reforms. The agency noted that improved liquidity positions and predictable cash flows are key to maintaining credit quality across central and state-owned gencos.
The report emphasized that central government-owned entities like NTPC continue to benefit from a strong operational profile, timely payments, and tariff-based competitive bidding structures. In contrast, state government-owned gencos, while stable, may face moderate pressure from delays in subsidies and dues.
Fitch also pointed out the importance of improved collections, reduction in AT&C losses, and the strengthening of power purchase agreements (PPAs) to maintain creditworthiness.
India’s push toward renewable energy and the continued execution of key sectoral reforms—such as the Revamped Distribution Sector Scheme (RDSS)—are also expected to support the sector’s credit stability in the medium term.
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