Credit Opinion: Bharti Airtel Ltd.

Transcription

1 Credit Opinion: Bharti Airtel Ltd. Global Credit Research - 22 Sep 2014 India Ratings Category Outlook Issuer Rating Bharti Airtel Int'l (Netherlands) B.V. Outlook Senior Unsecured -Dom Curr Moody's Rating Stable Baa3 Stable Baa3 Contacts Analyst Phone Annalisa Di Chiara/Hong Kong Nidhi Dhruv/Singapore Laura Acres/Hong Kong Key Indicators [1]Bharti Airtel Ltd. 6/30/2014(L) 3/31/2014 3/31/2013 3/31/2012 3/31/2011 Scale (USD Billion) $14.4 $14.2 $14.1 $15.0 $13.1 EBITDA Margin 38.3% 37.9% 36.2% 38.6% 39.3% Debt / EBITDA 2.9x 3.1x 3.2x 3.2x 3.4x FCF / Debt 6.7% 3.8% 6.3% 4.3% -14.4% RCF / Debt 25.3% 22.8% 22.4% 22.7% 21.4% (FFO + Interest Expense) / Interest Expense 5.7x 5.4x 4.9x 4.8x 6.0x (EBITDA - Capex) / Interest Expense 2.5x 2.1x 2.2x 1.9x -1.8x [1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non- Financial Corporations. Source: Moody's Financial Metrics Note: For definitions of Moody's most common ratio terms please see the accompanying User's Guide. Opinion Rating Drivers 1. Global player supported by market leading position in India 2. Evolving regulatory framework in all markets 3. Moderate, albeit improving financial leverage 4. Substantial FX risk related to the high level of foreign currency borrowings, although improving 5. Strong shareholder base

2 6. Future event risk Corporate Profile Founded in 1994, Bharti Airtel Ltd ("Bharti") is the 4th largest operator globally based on total number of subscribers with operations in 20 countries across Asia and Africa. Bharti has been listed on the Bombay Stock Exchange and National Stock Exchange since Within India, the company's product offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high speed DSL broadband, IPTV, DTH, enterprise services including national & international long distance services to carriers. In the rest of the geographies, it offers 2G, 3G wireless services and mobile commerce. Bharti Airtel had nearly 299 million customers across its operations at the end of June India accounted for about 66% of consolidated revenues and 75% of reported EBITDA for last twelve months ended 30 June Bharti's main shareholders include the Mittal family, Singapore Telecommunications Limited ("SingTel", Aa3 stable) which owns 32.3%. Qatar Foundation Endowment ("QFE") which owns 5% is also a key shareholder. Rating Rationale Bharti's Baa3 rating is underpinned by its receipt of strong and growing cash flows from its Indian operations, particularly in wireless voice and data, where it enjoys a well-established and leading market position under the Airtel brand. At the same time, concerns exist regarding emerging market risks and, in particular, changes to the regulatory and political environments in the countries in which it operates, especially considering its investment into 17 African countries. The regulatory environment for telecommunications in India had been fraught with uncertainty over the past several years, though the situation is clearing and boding more favourably for the operators. This results in an expectation of lower regulatory charges for Bharti and together with an industry-wide reduction in competitive pressures should help to contribute to ongoing improvements in cash flow generation. Bharti's financial metrics are recovering following the 2010 debt-funded and transformational acquisition of wireless assets in Africa, coupled with high payouts on 3G auctions in the same year. However, while leverage, at an adjusted consolidated 2.9x for the last twelve months (LTM) ending 30 June 2014, remains high for the current rating level, we anticipate continued absolute and relative deleveraging, such that adjusted debt/ebitda will measure 2.5x by 31 March The rating also takes into account the company's currency mismatch with its revenue base. Although this situation may give rise to translation risk, the company has a board approved policy of hedging a minimum percentage of total foreign liabilities due, covering a substantial portion of liabilities due over the next 12-month period, thereby partially mitigating the impact of rupee depreciation. However, Bharti continues to take proactive steps to manage down its foreign currency exposure, through the issuance of CHF350 million bonds due March 2020, and two Euro denominated issuances totaling Euro 1.0 billion due December 2018 and its May 2014 issuance of Euro 750 million due May The company has also been actively terming out its US$ debt maturity profile, for example through its May 2014 issuance of $1.0 billion notes due May The Euro denominated issuances have also helped the currency profile of the debt as a third of Bharti's African operations generate cashflows in currencies which are pegged to Euros. Finally, although Bharti's direct and indirect subsidiaries in Africa have largely raised debt on a non-recourse basis, Moody's remains concerned that it may need to provide additional financial support to its overseas subsidiaries in a distress situation. This is, however, an unlikely scenario at the moment, as the operating performance of its African operations has improved, and the latter have made positive cash flow contributions (estimated as EBITDA less capex) in each of the last 8 quarters. Recent Developments Bharti continues to take proactive measures to pay down balance sheet debt. In August, Bharti sold a 4.5% stake in its tower business unit, Bharti Infratel, through an Offer for Sale (OFS) that raised RS 21,395 billion ($348.8 million). We expect all proceeds from the sale will go towards paying down debt. The sale was initiated to ensure compliance with the new securities laws that require listed companies in India to have a minimum of 25% of share

3 available on the stock exchange. Bharti's stake in Infratel is now 75%. Airtel has received equity flows of around $900 million since 2012 through sale of Bharti Infratel shares. At the same time, in June 2012, the company had raised over USD 1.2 billion through a 5% stake sale to QFE, also exemplifying the company's ability to execute opportunistic equity transactions. Further, the company continues to look at potential monetization opportunities. The company has a portfolio of c.15,000 towers in Africa which it could potentially look to hive-off, similar to the structure in India where independent tower companies were formed early on. In September, the company agreed to sell 3,500 Africa - based telecom tower to Eaton Towers (unrated) for an undisclosed amount. This follows the company's July announcement to divest 3,100 Africa-based telecom towers to Helios Towers (unrated) Africa for an undisclosed sum. The agreement is subject to statutory and regulatory approvals in the respective countries and further terms and conditions have not yet been released. We expect all sales proceeds will be deployed toward balance sheet debt reduction. However, as Bharti plans on leasing space off the towers under long-term contracts, on Moody's lease-adjusted basis, the transaction may be leverage neutral. In July, the Bharti announced solid first quarter 2015 earnings posting year-on-year ("y-o-y") growth of 13.3% and 18.0% in reported revenue and EBITDA. Growth was driven primarily by continued robustness in its mobile business in India which recorded y-o-y growth of 10% in revenue and 25% in EBITDA. Although voice services remained the predominant profit driver for the company, growth in data services for the year was more pronounced with a 52% y-o-y increase in the customer base and 8.4% increase in average revenue per user (ARPU). Data customers as a percentage of total subscribers in the mobile segment in India also increased to 18.8% as of June 2014 from 13.6% a year ago. Africa also reported a 8% y-o-y growth in subscribers while ARPU increased modestly by 2%. However, despite a 10% increase in revenues, operating expenses jumped 14.4%, resulting in flat EBITDA. EBITDA margins for this segment remained sluggish at about 24.3%, though free cash flow (using EBITDA -- capex as a proxy) increased by 5% y-o-y as capital investments were modestly lower in June DETAILED RATING CONSIDERATIONS 1. GLOBAL PLAYER SUPPORTED BY A LEADING MARKET POSITION IN INDIAN WIRELESS In India, Bharti offers a full range of services, including wireless (2G, 3G and 4G), fixed line, broadband, highspeed DSL and digital TV. It is the largest mobile operator in the country with a subscriber market share of 23% and revenue share of about 30.5% as of 30th June 2014 (Telecom Regulatory Authority of India, "TRAI"). In terms of revenue contribution, businesses in India accounted for about 66% of consolidated revenue for the last twelve months ended 30 June 2014, thus providing a solid base to the rating. We believe Bharti has created an innovative business model in India with a focus on providing affordable mobile telephony services. The model centers on a "minutes factory" producing the lowest-cost minute possible, as well as offering simple, user-friendly, largely pre-paid tariff plans with electronic top-ups at minimal denominations. Its mobile and data service plans also feature some of the lowest activation costs of any network in India. A key element of Bharti's ability to lower costs entails developing strategic partnerships and outsourcing. It has established relationships with network partners, such as Ericsson, NSN and Huawei and ZTE, which manage the telecom network. This allows for purchase of network equipment and capacity on a pay-as-you-grow basis, rather than at pre-determined rates for set capacity amounts that may or may not reflect actual capacity requirements. Rates paid to the network partners are adjusted based on quality of service metrics. Bharti has minimized its dependence on any single network partner to provide critical network services by obtaining ownership of equipment deployed by its network partners, and utilizing GSM technology that can be set up and maintained with standardized components. This approach allows equipment installed by one partner to be modified, expanded and maintained by another competing partner. Bharti is therefore able to enter into short-term non-exclusive contracts with its network partners. Bharti has sourced most of its tower requirements through Infratel and Indus. It has adopted a similar partnering strategy for its African operations. Through these measures, it can manage capex and opex more effectively.

4 Competition in India is easing. Overcapacity in the sector has eased with the exit and scaling back of operations by the smaller and/or unprofitable operators. The three largest operators -- Bharti (22% subscriber market share); Vodafone India (18%); and Idea (15%) -- have successfully been able to improve realizations over the past 12 to18 months. Given the high operating leverage in the business model, Bharti has been able to effectively expand margins during this period by over 350bps as a result of this. At the same time, ARPU has increased and churn has been kept under control as India is still in its infancy in terms of data consumption. But usage is growing rapidly, and for Bharti stood at 11.1% of wireless revenues as of June 2014, still principally driven by non-3g subscribers as most data is still carried on 2G networks. Currently, it has 10.9 million 3G subscribers. This number will also grow as data-enabled handsets and specifically smartphones become increasingly affordable, and more subscribers migrate up to 3G. Bharti's acquisition of 900MHz spectrum in Mumbai will also enable it to launch 3G services in this important circle which should provide a fillip to its 3G subscriber base. In June 2014 the Company announced its definitive agreement to acquire Loop Mobile, which will it add 3 million subscribers to Bharti's existing subscriber base of 4 million in Mumbai, catapulting it to a strong position of leadership in Mumbai - which is a key telecom market in India. It is also immediately EBITDA accretive for Bharti, which we view positively. The expanded subscriber base in Mumbai post the acquisition of Loop, coupled with Bharti's newly acquired 5MHz of 900MHz spectrum, will significantly boost the company's competitive position in this key market and also provide it with a strong platform to launch its 3G service. In respect of non-wireless operations, revenue and EBITDA contributions remain relatively small, but with natural synergies with the core wireless operation. Taken together, these businesses - broadband, digital TV, ICT services, and telecommunications tower infrastructure (through Infratel and Indus) - account for approximately 15% to 20% of consolidated revenue. Revenue has been growing across these businesses, as has EBITDA, particularly since the digital TV operation turned EBITDA positive in June-September 2012 as a result of both increases in ARPU and customer additions. Through Infratel and Indus Towers, Bharti builds and operates tower infrastructure for wireless telecommunication service providers in India. As of 30 June 2014, Infratel alone owned and operated 36,112 towers in 11 telecommunication circles in India. With the inclusion of its economic interest in Indus Tower, Infratel managed over 113,490 towers (83,778 on a pro-rata basis) and is one of the largest tower providers in the country. Growth in the tower business has been relatively stagnant for the past few years, given the level of regulatory uncertainty which resulted in operators holding back on investments. The recently concluded spectrum auctions should bring in a wave of new 3G investments by incumbent operators. Reliance Jio's (unrated)--the telecommunication arm of Reliance Industries (Baa2 positive) and a direct competitor--recently announced tower sharing agreement with Infratel for the roll-out of its services is such an example. Infratel/Indus are well positioned to benefit from such investments. Given zero leverage at Infratel and the company's dividend paying history, we believe that Bharti will continue to benefit from dividend receipts from Infratel. It is also highly likely that Bharti will seek to monetize its investments in the Indian tower business further by reducing its stake in Infratel beyond the requirement to reduce to 75% within 3 years of listing, and which the company has already achieved with the block sale in August We also believe the company will look to further opportunistically monetize its stake in Infratel over time. Following Bharti's USD10.7 billion acquisition of 100% of Zain Africa's operations in 15 countries in 2010, Bharti has established operations in 17 countries (acquired 15 as part of Zain, and added the Seychelles in 2010 and Rwanda in 2011), and has steadily increased its subscriber base. Bharti is focused on 3G roll-outs as a means of increasing its African subscriber base and 3G has now been rolled out in 15 markets. License costs have proved reasonable. Typically awarded for year terms, the costs of these are not significant as a part of overall capex. Bharti has also invested in developing Airtel Money -- a mobile banking and money transfer service - across all countries. This operation has proved useful in creating stickiness with subscribers and reducing churn. The African business has grown each quarter albeit at a slower than expected pace. Having invested a significant

5 amount early on in the acquisition, capex has now fallen substantially and is driven by demand rather than coverage, such that Africa is now self-financing in terms of capex and debt service, and is no longer a major cash drain on Bharti's core operation. Bharti also offers wireless services in Sri Lanka and Bangladesh. The overall contribution from this segment, however, remains relatively small at only about 2% of total revenue and it is still free cash flow negative. 2. EVOLVING REGULATORY FRAMEWORKS IN ALL MARKETS India's telecommunication industry is under the jurisdiction of two main entities: TRAI and the Department of Telecommunications (DoT). The evolving regulatory framework and frequent policy changes have led to significant challenges for operators. In November, India's Telecom Commission increased TRAI's recommended pricing for 1800 MHz and 900MHz spectrums by an average of 15% and 25% respectively. The auctions successfully concluded in February 2014 with the winning prices being about 25% higher than reserve price. Notwithstanding the higher pricing, the auctions brought an end to a period of uncertainty overhanging the sector. By securing spectrum allocation in these auctions, Bharti has effectively hedged its future renewal risk for its 900 MHz and 1800 MHz spectrum in Delhi and Kolkata, which are due for renewal in November 2014 and also acquired prime data spectrum band. In this auction Bharti was also able to acquire the 900 Mhz band in Mumbai and is likely to use this for 3G services, which should provide a stronger operating environment in the key market of Mumbai. Spectrum auction renewals remains a concern. In August 2014, TRAI began the consultation process for the next round of auctions for spectrum held by mobile operators - Airtel, Vodafone, Idea and RCom - as some of their licenses are set to expire in The process will determine the reserve price of spectrum to be auctioned across 18 out of the 22 telecom service areas across the country for 900Mhz and 1800Mhz bands, used for providing mobile services based on GSM technology standard. Bharti seems to be well poised for the auction with 6 circles in 9000MHZ circles coming up for renewal, and is well covered with 1800MHZ and 2100 MHZ. This compares with Idea's nine circles, Vodafone's seven circles, and RCom's seven circles each coming up for renewal in in 900MHz band. Also Bharti has de-risked itself largely from the renewal process by picking up 1800Mhz spectrum band in these circles in the last round of auctions TRAI has also already given its recommendation for CDMA spectrum auction. The companies can renew their licences by paying a fixed fee but for continuing mobile and other wireless services they will need to buy spectrum afresh through auction at market determined rates. Bharti's operations outside of India are mostly in riskier markets from a regulatory, political and economic risk perspective; nonetheless, they also offer good growth opportunities, particularly given that ARPU levels are significantly higher than the home market. While it is easy to consider Africa as showing higher regulatory risk, it is also important to recognize the diverse and independent nature of Bharti's operations in the continent. 3. MODERATE, ALBEIT IMPROVING, FINANCIAL LEVERAGE The combination of easing competition, lower regulatory costs, debt reduction, improved liquidity and Africa contributing to cash flow resulted in Bharti reporting an improving set of financial metrics with adjusted debt/ebitda of 2.9x as of LTM 30 June 2014, down from 3.4x as of 31 March 2011 following the acquisition of its African assets. We anticipate a period of relative stability over the next 2-3 years. In the core market, this will be driven by ongoing gradual improvements in ARPU and increased data usage. The African businesses continue to bring on subscribers and, given reduced capex, will be self-financing. Debt exists at various levels within the Bharti capital structure. However, certain facilities are ring-fenced, given the ability of particular operations to service their own debt, including about USD 2 billion of bank debt held at the African operations under the guarantee of Bharti Airtel Africa and secured on local assets. This debt is nonrecourse to Bharti, however it is Moody's view that Bharti would provide financial support, if required. In 2010, Bharti entered into a USD7.5 billion credit facility agreement with a syndicate of international banks, in addition to bilateral facility agreements totaling USD2.0 billion. The proceeds were used to fund the acquisition of

6 its African assets. However the acquisition facilities have been fully been refinanced through bond issuances (totaling USD 5.3 billion) and the balance through bi-lateral bank facilities. Bharti is in full compliance with its bank covenants for these bilateral facilities. During the quarter ended June 30, 2014, the company raised USD 1billion in 5.35% guaranteed notes due 2024 and EUR750 million in 3.375% bond due Proceeds were used to refinance part of the aforementioned acquisition debt, thus helping to lengthen its debt maturity profile, and also diversify away from US$ exposure. 4. SUBSTANTIAL FX RISK, GIVEN HIGH LEVEL OF FOREIGN CURRENCY BORROWINGS At March year-end around 60% of the company's total outstanding debt was denominated in USD, with the remainder in a wide range of currencies. We believe this mix would have further improved, given the EUR bonds issuance since then and paydown of debt using OFS proceeds. Given the high degree of foreign currency borrowings versus its largely rupee-denominated cash flows, Bharti's ability to manage its foreign currency exposure is an important credit factor. However, some safeguards around this risk include: Bharti has an approved policy of hedging a minimum percentage of total foreign liabilities due, covering a substantial portion of liabilities due over the next 12-month period. At the Indian operation level, there is some USD500 million of debt denominated in USD, and which is naturally hedged against some USD400 million in annual revenues. Covenants on its bilateral facilities, at the acquisition level, are calculated based on USD financials translated from INR to USD at the same rates as used for publishing financial statements. Based on this approach, last 12 months to 31 June 2014, net debt/ebitda was 2.04x, versus a covenant of 3.25x. Headroom under the covenant has been on a broadly improving trend. Furthermore, concerns regarding the impact of rupee depreciation scenario against its US$ debt balance is manageable considering the steps taken to reduce its US dollar exposure with is EUR and CHF bond issuances, as well as the expected debt pay down from tower sale proceeds and investment monetization activities. Finally, we understand Bharti will remain proactive in diversifying currency risk against the USD, although its financial statements will remain highly exposed to translation risk for the time being. 5. FUTURE EVENT RISK Bharti's long-term comfort zone of is net debt / EBITDA of 2.0x. Historically, Bharti's financial profile has been very conservative. Prior to the Zain acquisition it was almost net cash, and even post-zain, it has continued to generate positive free cash flow each year despite high levels of capex. We are however, concerned about the possibilities of event risk, as management has displayed a strong willingness in the past for mega deals, having both considered the acquisition of MTN and then subsequently acquired Zain. Over the near term, however, we do not expect Bharti to engage in material M&A and expect it to focus more on in-country consolidation opportunities rather than entry to new markets. Bharti aims to be the number 1 or 2 operator in each market and will seek acquisitions of smaller operators to achieve that position. The acquisition of Loop Mobile in Mumbai is an example of such acquisition. Given the current portfolio, Moody's believes that such acquisitions would be no more than USD million and likely in overseas business opportunities. Conversely, should it not see a path towards achieving a solid market leading position, then it would consider exiting that market. 6. STRONG SHAREHOLDER BASE Apart from the Mittal family, SingTel is a major shareholder with an indirect ownership of 32.3%. SingTel maintains a close relationship with Bharti as the company represents an integral part of SingTel's emerging markets portfolio. Excluding Optus Limited, the second largest operator in Australia, Bharti is SingTel's largest overseas investment with invested capital of SGD2.31 billion. Other than transferring know-how, providing technology support and cross-staff transfers, SingTel also holds 2 of 16 seats on the board. All material strategic decisions are consented

7 cross-staff transfers, SingTel also holds 2 of 16 seats on the board. All material strategic decisions are consented by the board. While SingTel maintains a stance of being arms length from its investments, Moody's is of the view that they would be very supportive and could attempt to increase its stake further, subject to conditions. In June 2013, Bharti sold a 5% interest to QFE for USD1.26 billion and used the money for debt reduction. Liquidity As of 30 June 2014, Bharti had about USD2.2billion (INR137.7billion) in cash and short-term investments, compared to USD2.3billion (INR139.7 billion) in short-term debt. Overall liquidity profile remained strong with the company generating over about USD4.5billion (INR 276 million) in cash from operations on a LTM basis. Although the company also has recurring maintenance capex of about USD1.6 billion (INR100 billion) and spectrum payments of about USD870 million (INR54 billion) in the next 12 months, the company has more than sufficient resources to cover such outflows. Structural Considerations Bharti Airtel Ltd is not a pure holding company as it accounts for more than 50% of consolidated revenue and 60% of EBITDA. Furthermore, the debt at its African level is non-recourse and can be serviced out of Africa-sourced cash flow. As such, we do not apply notching for structural subordination. Rating Outlook The rating outlook is stable based on the expectation that Bharti will continue to grow its core Indian and African wireless businesses and that the group will continue to deleverage on both an absolute and relative basis. What Could Change the Rating - Up The rating may experience upward pressure should Bharti's overall credit profile continue to strengthen; in particular Moody's would like to see Bharti reduce consolidated adjusted debt/ebitda to below 2.0x and for consolidated adjusted free cash flow to debt to exceed 10%. We would also like to see a track-record that shows that some of its key markets outside of India (such as Nigeria) demonstrate the ability to upstream cash flows to Bharti, while the operating performance of those subsidiaries remains solid. What Could Change the Rating - Down Downward pressure could arise should competition intensify in any of its key markets, but particularly for the Indian wireless business, such that its key operations and/or subsidiaries report materially declining margins, or Bharti fails to continue with its deleveraging strategy. Moody's would seek evidence of this trend with consolidated debt/ebitda remaining above 3.0x, consolidated free cash flow/debt remaining below 5%, or adjusted EBITDA margins falling below 35%. Furthermore, any unexpected regulatory developments in any of Bharti's key markets will also be negative for the rating. Given Bharti's recent history of a transformational and debt-fund acquisition, Moody's would also view negatively any event risk associated with a material acquisition or other corporate activity that negatively impacts the company's existing or targeted leverage ratios. Other Considerations Methodology Output: In accordance with the Global Telecommunications Industry (December 2010) methodology, Bharti's grid output (on a consolidated basis) is Baa3, which is consistent with the assigned rating. Dividend Policy: Bharti has no stated dividend policy. It announced its maiden dividend just a few years ago, but these have been extremely modest - less than USD70 million for fiscal year ended March 2013 compared to free cash flow of USD1.4 billion. While we anticipate the payout increasing, the expectation is that it will remain modest relative to cash flow generation and will also be aided by dividend receipts from investee companies such as Bharti Infratel and hence may remain neutral on a net basis

8 Rating Factors Bharti Airtel Ltd. Global Telecommunications Industry Grid [1][2] Current LTM 6/30/2014 Factor 1: Scale And Business Model, Competitive Environment And Technical Measure Score Positioning (27% ) a) Scale (USD Billion) $14.4 A b) Business Model, Competitive Environment and Technical Positioning Baa Baa Factor 2: Operation Environment (16%) a) Regulatory and Political Ba Ba b) Market Share A A Factor 3: Financial Policy (5%) a) Financial Policy Baa Baa Factor 4:Operating Performance (5%) a) EBITDA Margin 38.3% Baa Factor 5: Financial Strength (47%) a) Debt / EBITDA 2.9x Ba b) FCF / Debt 6.7% Ba c) RCF / Debt 25.3% Baa d) (FFO + Interest Expense) / Interest Expense 5.7x Baa e) (EBITDA - Capex) / Interest Expense 2.5x Ba Rating: a) Indicated Rating from Grid Baa2 b) Actual Rating Assigned Baa3 [1] All ratios are based on 'Adjusted' financial data and incorporate Moody's Global Standard Adjustments for Non- Financial Corporations. [2] As of 6/30/2014(L); Source: Moody's Financial Metrics This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on for the most updated credit rating action information and rating history Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved. CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. ("MIS") AND ITS AFFILIATES ARE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND CREDIT RATINGS AND RESEARCH PUBLICATIONS PUBLISHED BY MOODY'S ("MOODY'S PUBLICATION") MAY INCLUDE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY'S DEFINES CREDIT RISK AS THE RISK THAT AN

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