Fitch rates Hangzhou Hikvision notes A-

Fitch Ratings said it assigned long-term foreign-currency and local-currency issuer default ratings of A- to Hangzhou Hikvision Digital Technology Co., Ltd.

The outlook is stable.

The agency also said it assigned a senior unsecured rating of A- and an expected A- rating to the company’s proposed senior unsecured euro-denominated notes.

The notes are rated in line with Hikvision’s senior unsecured rating of A- as they will represent direct, unconditional, unsecured and unsubordinated obligations, Fitch said.

The proceeds from the proposed senior unsecured notes will be used to refinance Hikvision’s existing debt and for capital expenditure, procurement of raw materials and general corporate purposes, the agency said.

Hikvision’s ratings benefit from a one-notch uplift due to its moderately strong linkage with China Electronics Technology Group Corp., Fitch said.

Hikvision, whose standalone rating level is BBB+, is China Electronic’s only platform in the surveillance market within the group and the general platform for its key projects, the agency said.

Fitch said it expects China’s video-surveillance market to expand further, driven by the continued increase in China’s public security expenditure.

The ratings also reflect Hikvision’s world-leading market positions in closed-circuit television and video-surveillance equipment, the agency said.

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