Fitch rates Siam Cement debt A(tha)

Fitch Ratings said it affirmed the Siam Cement plc's national long-term rating at A(tha) and national short-term rating at F1(tha), along with its outstanding senior unsecured debentures at A(tha). The agency also said it assigned a rating of A(tha) on its new senior unsecured debentures No.1/2010, amounting up to 10 billion in Thai baht due 2014. Proceeds will be used to refinance the company's maturing debentures.

The outlook is stable.

The ratings reflect the company's leading position in each business segment, its good revenue diversification, cost competitiveness, extensive distribution channels, strong brand recognition in the domestic market and the solid track record of senior management, Fitch said.

The ratings also reflect the group's relatively strong cash flow generation and a less aggressive capital expenditure plan during 2010 to 2011, the agency said.

The ratings also consider the expected margin pressure in the petrochemical business driven by a supply influx from the Middle East, Fitch added.

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