April 12, 2012. Credit rating agency Moody's has downgraded the local currency ratings of state-owned Oil and Natural Gas Corporation (ONGC) and GAIL, as a reflection of the risks that these two entities share with the Indian government. Moody's Investors Service has downgraded the local currency rating of ONGC to Baa1 from A2 and that of GAIL to Baa2 from A3. The outlook for both the ratings is stable. However, there has not been any deterioration in the intrinsic credit quality of either ONGC or GAIL, Moody's said. Both issuers are still rated above the sovereign as a reflection of their stronger credit quality, but the gap is smaller than before, Moody's said. ONGC gets over 85 per cent of its revenue from India and GAIL gets almost 100 per cent. Besides, both the firms have a high degree of direct government ownership (69 per cent for ONGC and 57 per cent for GAIL). Domestic business concentration, banking/counterparty relationships, and government ownership and control are key channels for the transmission of credit stress, Moody's said.