Moody’s Investors Service has changed Tata Steel’s outlook from stable to positive. The change in outlook to positive shows the domestic steel giant’s track record of delivering a solid operating performance while maintaining conservative financial policies and the likelihood that upward rating pressures will intensify over the next 12 months as recent improvements in the in terms of performance and creditworthiness.
“Moody’s Investors Service has changed its rating outlook for Tata Steel Ltd (Tata Steel) from positive to stable,” the global rating agency said in a statement. “Tata Steel’s well-thought-out capital allocation policy, which prioritizes debt reduction over capital expenditures and new investments, underlines our positive outlook,” said Kaustubh Chaubal a Moody’s Senior Vice President.
The significant debt reduction achieved in the past two years, as well as the reduction that will take place in the remainder of FY’23, will significantly improve the company’s financial flexibility and resilience and position it for an investment-grade rating, Chaubal said.