S&P views Lianyungang Port negatively

S&P said it revised its outlook for Lianyungang Port Group Co. Ltd. (LYGP) to negative from stable and affirmed its BBB- issuer rating.

“LYGP will face increasing challenges to lengthen its maturity profile at a reasonable cost. We believe the company's liquidity has eroded, and improving the capital structure will be tough, especially if market liquidity tightens. We estimate LYGP has Chinese renminbi (RMB) 25.4 billion of debt due in 2023, or 56% of the total debt as of end-2022.

“The maturities in 2023 are about 6x the company's cash balance as of end-2022. About half of these maturities are short-term debt, including short-term bonds and working capital loans, and the rest are current maturities of long-term debt,” the agency said in a press release.

However, S&P noted the company has good access to banks and the onshore bond market to help it in its refinancing plans.

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