S&P upgrades Sunac

S&P said it upgraded Sunac China Holdings Ltd.’s rating to BB from BB- and its senior unsecured notes to BB- from B+.

“We raised the rating because we anticipate Sunac will continue to exercise financial prudence and limit debt growth over the next 12-24 months. The greater control over spending, combined with satisfactory revenue growth and profitability margin, should help the company to sustain its leverage. We forecast Sunac's debt-to-EBITDA ratio (both consolidated and after proportionally consolidating its joint venture [JV] projects) will stay between 4x and 5x from 2021, after significantly improving to about 4.4x at end-2020, from 6.3x at the end of 2019,” the agency said in a press release.

The outlook is stable.

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