KOCHI:Kannur International Airport Ltd (KIAL) has rejected the credit rating assigned by CareEdge Ratings, appearing in the agency’s “Unaccepted Ratings” list as of October 30, 2025.
Kannur airport reported a net loss of Rs93.9 crore in FY25, an improvement from Rs168.63 crore in FY24, yet its accumulated losses since inception have reached Rs838.86 crore. Paid-up equity has shrunk by over 63 per cent, from Rs1,338.38 crore to Rs502.48 crore, raising concerns over long-term viability.
Despite nearly doubling revenue in FY25 to Rs190.93 crore, mainly due to a surge in user development fees (UDF), KIAL’s high finance costs – interest expenses of Rs125.42 crore — pushed the company into a cash loss of Rs301.89 crore.
To stabilise the situation, the Kerala government infused Rs113 crore as subordinate debt, enabling refinancing of KIAL’s total borrowings of Rs1,215.70 crore through REC Ltd. The state also pledged 51 per cent of its equity stake and issued an irrevocable letter of comfort to support debt servicing.
Unaccepted ratings, disclosed by credit rating agencies to ensure transparency, signal cases where companies choose not to publicly reveal assigned ratings, often due to concerns over market perception or borrowing costs.
Analysts say KIAL’s refusal underscores caution amid financial stress, as lenders now view government support as critical.
With unresolved regulatory disputes, ongoing dependence on state guarantees, and a skewed debt-to-equity ratio, KIAL’s inclusion in the unaccepted ratings list highlights the challenges facing infrastructure projects with high government exposure and persistent financial instability.
