Fitch upgrades Sunac China

Fitch Ratings said it upgraded Sunac China Holdings Ltd.'s long-term foreign-currency issuer default rating, senior unsecured rating and the ratings on its outstanding senior notes to BB from BB-.

The outlook is stable.

The upgrades reflect a view that leverage, as measured by net debt-to-adjusted inventory, will lower than 40% for a sustained period, Fitch said.

Sunac has publicly committed to de-leverage and Fitch said it believes it will not aggressively make land acquisitions or large investments in other businesses.

The company's large attributable land bank of more than 113 million square meters of saleable gross floor area is well-diversified across various regions in China, which should support contracted sales growth, the agency said.

S&P said it expects Sunac to continue de-leveraging in 2019 in the absence of large land acquisitions, despite moderating contracted sales growth on weaker industry sentiment.

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