Vedanta s ratings reflect its unsustainable capital structure characterised by high financial leverage at the holding company and its perennially weak liquidity amid a period of continued large negative free cash flow, Moody s said.
S&P Global Ratings has warned that any changes in Vedanta Resources financial policy regarding debt transactions could lead to a downgrade of its credit rating. This would occur if Vedanta attempts a debt deal without adequate compensation or buys back debt below its face value. Vedanta is currently exploring ways to meet its obligations, but S&P maintains a negative outlook on the company due to potential funding shortfalls.