Moody's alters Lippo outlook to positive

Moody's Investors Service said it changed the outlook for Lippo Karawaci Tbk. to stable from positive and affirmed the B3 ratings on the issuer and the bonds it guarantees.

"The change in outlook to stable from positive reflects our expectation that Lippo Karawaci's marketing sales will likely drop over the next 12 months as housing demand moderates on the back of higher mortgage and inflation rates. It also takes into account the weaker-than-expected operating cash flow generation at the holding company such that it would be marginally cash flow negative over the next 12-18 months," said Rachel Chua, a Moody's vice president and senior analyst, in a press release.

"While refinancing risk is not yet imminent, the company has a large debt maturity wall with $405 million of bonds maturing in January 2025 and another $417 million of bonds maturing in October 2026," added Chua, who is also the agency’s lead analyst for Lippo Karawaci.

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