India’s nationwide lockdown, triggered in late March by COVID-19, has hit Future Group hard. The group saw sales at its over 2,000 stores across 437 cities plummet, as only stores selling essential items are allowed to stay open during the coronavirus lockdown.
Declining revenues coupled with ballooning debt, which was estimated at $1.8 billion across Future Group's five listed companies last September, sparked a series of ratings downgrades for the group companies. This, in turn, has led to shares of some of its group companies plunge to their lowest levels in years.
Recently, CARE Ratings in Mumbai downgraded the long-term and short-term borrowings of Future Retail, which runs hypermarket chain Big Bazaar and neighborhood grocery chains Easyday Club and Heritage Fresh.
Last week, Fitch Ratings, noting the impact of the coronavirus shutdown on the company’s liquidity, downgraded Future Retail’s U.S. dollar-denominated notes listed on the Singapore Stock Exchange from B- to CCC+.
And in April, CRISIL, an India-based affiliate of S&P Global, had downgraded the credit facilities of listed fashion arm Future Lifestyle Fashions, noting the deterioration in the business risk profile after the company was forced to shut all its fashion stores following the lockdown.