Moody's rates Lai Fung notes B1

Moody's Investors Service said it assigned a B1 rating to Lai Fung Holding Ltd.'s proposed senior RMB notes.

Lai Fung's B1 corporate family and senior unsecured debt ratings were affirmed.

The outlook is stable.

Proceeds will be used for general corporate purposes.

"The proposed senior notes will provide funding for Lai Fung to manage its existing projects and expansion," Lina Choi, a Moody's vice president, said in a statement.

"While the additional debt will increase Lai Fung's financial risk, we expect the company to maintain its record of prudent financial management," Choi said.

Moody's said it expects Lai Fung to maintain its strong cash position, which would be an important buffer in times of market stress.

Lai Fung's B1 corporate family rating reflects its stable rental income, and CapitaLand Ltd.'s (unrated) 20% equity interest, the agency noted.

The B1 rating is constrained by Lai Fung's weak track record in sales execution, small scale and geographic concentration in Shanghai and Guangzhou where regulatory measures are strong, according to the agency.

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