Fitch: Hoang Anh Gia notes B

Fitch Ratings said it affirmed Hoang Anh Gia Lai JSC's long-term foreign- and local-currency issuer default ratings at B.

The outlook is stable.

The agency also said it assigned a B senior unsecured rating to the company, as well as an expected B rating and a recovery rating of RR4 to its proposed dollar-denominated notes, which are guaranteed by its main operating subsidiaries.

The ratings are constrained by the company's large capital expenditure plans of more than $400 million until the end of 2013, Fitch said.

The company plans to diversify away from its established, but volatile, residential property development business in Vietnam into hydropower generation, iron ore mining and rubber plantations in Vietnam, Cambodia and Laos, which could increase execution risks, the agency said.

This concern is heightened by its high funding costs, a reflection of Vietnam's current high interest-rate environment, Fitch added.

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