Moody’s downgrades agricultural solutions provider UPL and maintains a negative outlook
Moody’s rating action follows UPL’s weak operating results for the third quarter of the fiscal year ending March 2024 (fiscal year 2024), the statement said.
Credit rating agency Moody’s Investors Service on Tuesday downgraded agricultural solutions provider UPL to Ba1, maintaining a negative outlook for the deterioration of the agrochemical industry.
Moody’s has downgraded the senior unsecured rating for UPL Corporation (UPL Corp) to Ba1 from Baa3 and also downgraded the long-term junior subordinated rating of UPL Corp’s $400 million undated perpetual Eurobonds to Ba3 from the rating agency Ba2. said in a statement.
Furthermore, Moody’s assigned UPL Corp a Ba1 corporate family rating (CFR) and withdrew the company’s Baa3 rating.
“The downgrade to Ba1 is driven by a prolonged deterioration in agrochemical sector fundamentals, which will leave UPL’s credit metrics weaker than our expectation for an investment-grade rating,” said Kaustubh Chaubal, Senior Vice President of Moody’s.
Moody’s rating action follows UPL’s weak operating results for the third quarter of the fiscal year ending March 2024 (fiscal year 2024), the statement said.
“UPL entered the current industry down cycle with significant leverage. This, combined with UPL’s working capital intensive business model and weak liquidity, has exacerbated the impact of tight financing conditions on its credit profile,” Chaubal added.
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First print: February 7, 2024 | 12:07 pm IST