Fitch assigns PTT Global, notes BBB

Fitch Ratings said it assigned BBB ratings to PTT Global Chemical PCL (Pttgc) a first-time long-term foreign-currency issuer default and senior unsecured ratings. Fitch also assigned a BBB senior unsecured rating to Pttgc's outstanding U.S. dollar debentures issued under its global medium-term note program. The outlook is negative.

The notes were issued under its fully owned financing subsidiary GC Treasury Center Co. Ltd., and are guaranteed by Pttgc.

“The U.S. dollar notes are rated at the same level as Pttgc's senior unsecured debt as they constitute direct, unconditional, unsubordinated and unsecured obligations of Pttgc,” Fitch said in a press release.

“Pttgc's ratings reflect its position as a leading petrochemical company in the region, its cost-competitive feedstock supply and product offtake agreements with its parent, PTT PCL (PTT, BBB+/AAA(tha)/stable). The ratings also reflect Pttgc's high leverage and exposure to inherent volatility in the refining and petrochemical sectors,” Fitch said in a statement.

The outlook reflects the risk that its EBITDA net leverage may stay above 3.5x - the level above which Fitch said it may take negative rating action - in the medium term. “The company's earnings have been significantly weaker in the past 12 months than Fitch's expectations. We believe petrochemical product spreads will stay weak in 2024,” the agency said in a press release.

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