S&P shifts Dexin view to negative

S&P said it revised Dexin China Holdings Co. Ltd.’s outlook to negative from stable and affirmed the B issuer rating and B- rating on its senior unsecured bonds.

“We revised the outlook to negative because we expect Dexin's contracted sales to remain under pressure. Given the overall weakening property demand in China, Dexin's sales from July to October 2021 have fallen 11% year on year. As a result, we believe Dexin may slightly miss its 2021 sales target of Chinese renminbi (RMB) 73 billion, despite having achieved RMB 62 billion, or 85% of its target, in the first 10 months,” S&P said in a press release.

The agency also said Dexin may face challenges refinancing its more than $500 million in dollar-denominated notes due in 2022. “This is due to the volatility of the U.S. dollar bond market, in which the refinancing window may remain close over the next year. As a result, Dexin may need to repay the offshore maturities with its internal resources, reducing the company's liquidity buffer.”

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