Moneycontrol PRO
Check Credit Score
Check Credit Score
HomeNewsBusiness

Only 5% Asia Pacific infra firms highly exposed to COVID-19 disruptions: Moody's

A high proportion (67 percent) of rated project and infrastructure companies in Asia Pacific continue to have low exposure to the coronavirus-related disruptions, supported by their essential nature and predictable cashflows, Moody's Investors Service said in a statement.

June 03, 2020 / 05:08 PM IST

Barely 5 percent of the rated project and infrastructure companies in Asia Pacific have high exposure to coronavirus disruptions, Moody's Investor Service said on Wednesday. Pressure has eased for Chinese toll roads, while a small number of utilities face moderate exposure, it said.

A high proportion (67 percent) of rated project and infrastructure companies in Asia Pacific continue to have low exposure to the coronavirus-related disruptions, supported by their essential nature and predictable cashflows, Moody's Investors Service said in a statement.

“The number of companies with high exposure has reduced in recent months, particulary the Chinese toll road sector following the end of the toll-free period and with recovering traffic volumes,” said Arnon Musiker, senior vice president and manager at Moody's.

Airports now make up most of the high exposure category, he said.

Whereas Moody's in April estimated 9 percent of project and infrastructure companies had high exposure to coronavirus disruptions, this number has now declined to 5 percent.

COVID-19 Vaccine

Frequently Asked Questions

View more
How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

View more
Show

"On the other hand, a small number of power utilities now have moderate exposure to coronavirus disruption, given rising pressure from falling power prices and lower demand, which is only partly offset by lower fuel costs," the statement said.

Following the reclassification of these toll roads and utilities, the number of companies with moderate exposure has increased to 28 percent from 23 percent in April.

“Moreover, a limited number of projects with exposure to commodity risk – particularly energy-related – also face rising challenges following the recent material fall in oil, gas and coal prices,” Musiker said.

Still, the majority – 67 percent – of companies face low exposure, and include regulated utilities, projects and public-private partnerships, the statement said adding, this risk exposure for regulated networks remains low notwithstanding temporary tariff relief measures instituted by certain companies, given their temporary nature and immaterial effect on metrics.

Follow our full coverage of the coronavirus pandemic here.

PTI
first published: Jun 3, 2020 05:07 pm

Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!

Advisory Alert: It has come to our attention that certain individuals are representing themselves as affiliates of Moneycontrol and soliciting funds on the false promise of assured returns on their investments. We wish to reiterate that Moneycontrol does not solicit funds from investors and neither does it promise any assured returns. In case you are approached by anyone making such claims, please write to us at grievanceofficer@nw18.com or call on 02268882347