CRISIL stated that the rating continues to reflect the strong business risk profile of NLCIL, backed by high operating efficiency, regulated cash flow and captive fuel availability for its power plants.

The rating also factors in the company’s strategic importance to the Government of India and healthy financial risk profile because of comfortable capital structure and liquidity.

These strengths are partially offset by exposure to risks related to counterparty and implementation of the ongoing capacity expansion projects.

NLC operates lignite and coal mines and thermal power stations in Neyveli and Tuticorin (NTPL) in Tamil Nadu and Barsingsar, Rajasthan and Odisha. It sells power to the state utilities of Tamil Nadu, Telangana, Rajasthan, Andhra Pradesh, Kerala, Karnataka and the Union Territory of Puducherry. It was awarded the Navratna status in fiscal 2011.

On a consolidated basis, for fiscal 2024, profit after tax (PAT) was Rs 1,868 crore on revenue from operations of Rs 12,999 as per the abridged financial statement of the company.