Fitch revises Jababeka view to negative

Fitch Ratings said it revised the outlook on PT Kawasan Industri Jababeka Tbk.'s (KIJA) long-term issuer default rating to negative from stable and affirmed the IDR at B-.

The agency also affirmed the rating on the company’s $300 million unsecured notes due 2023 at B-, with a recovery rating of RR4. The notes are issued by KIJA's subsidiary, Jababeka International BV, and guaranteed by KIJA and certain operating subsidiaries.

Fitch Ratings Indonesia simultaneously downgraded KIJA's national long-term rating to BB+(idn) from BBB-(idn). The outlook on the national long-term rating is negative.

The negative outlook reflects the increased uncertainty around KIJA's ability to refinance its $300 million unsecured notes due on Oct. 5, 2023, Fitch said in a news release.

“Capital-market conditions have deteriorated significantly over the last few months as high inflation and rising interest rates dim global growth prospects. While easing Covid-19 curbs in Indonesia should keep KIJA's operating cash flows steady, its liquidity may come under pressure if capital markets remain unfavorable,” Fitch said in the release.

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