Fitch affirms Guorui, notes at B

Fitch Ratings said it affirmed Guorui Properties Ltd.’s long-term issuer default rating at B with a stable outlook.

The agency also affirmed the senior unsecured rating and the ratings on the company’s outstanding notes at B with a recovery rating of RR4.

“Guorui's rating is supported by a strong EBITDA margin, stable investment-property rental income and a quality land bank that is large enough to support sustained improvement in its contracted sales,” Fitch said in a news release.

“However, the rating is constrained by its high leverage, as measured by net debt/adjusted inventory, of 55% at end-December 2017. Fitch estimates leverage will start to decrease as growth in contracted sales accelerates in the second half of 2018.

“Guorui's business is also geographically concentrated, with four cities – Langfang, Shenyang, Beijing and Haikou – accounting for about 54% of its total land reserves at end-2017, although this improved from 69% at end-2014.”

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.