Moody's alters Lippo Karawaci view to positive

Moody's Investors Service said it changed the outlook to positive from stable and affirmed the B3 corporate family rating of Lippo Karawaci Tbk.

The agency also affirmed the B3 backed senior unsecured rating of the bonds issued by Theta Capital Pte. Ltd., a wholly-owned subsidiary of Lippo Karawaci which are guaranteed by Lippo Karawaci and some of its subsidiaries.

"The rating affirmation with a change in outlook to positive reflects our expectation of an improvement in Lippo Karawaci's operating cash flow at the holding company level over the next 12-18 months, mainly driven by strong growth in its core marketing sales, the construction completion of its legacy projects and a reduction in rental payments to First REIT," said Jacintha Poh, a Moody's senior vice president, in a press release.

"We expect Lippo Karawaci's net cash flow from its property development business and dividend cash flows from its key operating subsidiaries to be sufficient to meet rental and interest payments at the holding company level over the next 12-18 months, such that it does not need to rely on one-off asset sales," added Poh.

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