Fitch cuts Shanghai Electric

Fitch Ratings said it downgraded Shanghai Electric (Group) Corp.'s long-term foreign-currency issuer default rating and foreign-currency senior unsecured rating to A- from A.

The outlook is stable.

Fitch also downgraded the long-term foreign-currency issuer default rating of the company’s 61%-owned subsidiary, Shanghai Electric Group Co., Ltd. , as well as its foreign-currency senior unsecured rating to A- from A.

The outlook is stable.

Fitch said it rates Shanghai Electric using a top-down approach from its internal assessment of the credit profile of the company's parent, the Shanghai government.

“The downgrade is due to a widening in the notching between SEG and Shanghai, driven by a deterioration in SEG's financial profile following the consolidation of Suzhou Thvow Technology Co., Ltd. (Thvow) in 1H19 and continued working-capital needs for its acquired businesses,” the agency said in a news release.

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