The rating and research in India has been solved by a rating watch with developing impacts on Tamil Nad Nadu Power Distribution Corporation Limited after a successful restructuring and distribution of the former Tangedco assets in the bifurcation process.
The Ministry of Union’s company approved the decision of the State Government to restructure Tangedco into two separate entities – Tamil Nadu Power Generation Corporation Limited (TNPGCL) for generation and Tamil Nadu Power Distribution Corporation Limited (TNPDCL).
It also approved the design of carving a new entity, Tamil Nadu Green Energy Corporation Limited for renewable energy, by combining the renewable energy of Tangedco since 27 June 2024 and merging with the Energy Development Agency (TEDA).
“The division of the obligations and assets of the former Tangedco is completed and all three entities have prepared their separate funds for fiscal 2025,” said India Ratings, a loan company.
Previously, it placed a rating watch with developing consequences, indicating that the evaluation can be upgraded, confirmed or reduced based on details that appear during bifurcation. India’s evaluation was confirmed by “Ind and (CE)”/Stable evaluation on TNPDCL bonds. The CE evaluation is based on the credit profile of the Tamil Nadu government. The Tamil Nadu government extended the unconditional and irrevocable warranty against the defallation on TNPDCL bonds, she said.
India’s evaluation also confirmed the “Indian BBB”/Stable rating on TNPDCL banking devices. TNPDCL is a monopolistic energy distributor in Tamil Nadu and plays a key role in the energy sector of the state. Even after the bifurcation, the state government continues to hold a 100% share in the state discom, she said.
India Ratings said it continues to classify TNPDCL as a dependent entity according to its evaluation criteria of public sector subjects.
The rating company said it confirmed the bank loan rating with regard to the lasting range of TNPDCL operations and improved profitability during the fiscal year 2025 based on interim finances.
The liquidity of TNPDCL is likely to be supported by the influx of subsidies/grant from the government of Tamil Nadu. In the middle of the severe losses incurred by TNPDCL, until the fiscal year of 2023, the state government budgets 100% of the losses of the fiscal year 2022. TNPDCL continues to rely on short -term work capital facilities to finance its long -term obligations for debt services.
TNPDCL received CRORE 31 849 GBP in subsidies for tariff and other income grants (mainly financing the loss by Tamil government) in the fiscal year 2025, said the rating company. He expects relying on subsidies to continue in the medium term. The TNPDCL debt increased by 22.28% to 1,06,113 Crore in the fiscal year 2025, he said.
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Published – 2 September 2025 12:32
