Fitch affirms rating on HUDCO's 'BBB-' with stable outlook

MUMBAI: Fitch Ratings has affirmed the rating on state-owned Housing and Urban Development Corporation Limited's ( HUDCO) 'BBB-' with Stable Outlook.
However, the rating agency said it will no longer rate the company because its "no longer considered relevant to the agency's coverage." Fitch said its rating on HUDCO is based the strong support the company receives from the government.

"This is because the company is 100% state owned, and it has a policy role in urban social infrastructure (for example, area development, water supply, sewerage and drainage) and housing for the economically weaker section and low-income group segment."

HUDCO has also received regular funding support from the government through annual budgetary allocations and regulatory forbearance in the form of higher exposure limits due to its policy role.

"For example, in the current financial year ending 31 March 2016, HUDCO has been allowed to raise up to Rs 5000 crore via tax-free bonds," Fitch.