S&P lowers China Jinjiang Environment to negative

S&P said it revised the outlook on China Jinjiang Environment Holding Co. Ltd. (CJE) to negative from stable.

The agency also said it affirmed the BB long-term issuer credit on the company and BB- long-term issue rating on the company's senior unsecured notes.

The outlook revision mainly reflects CJE's reducing financial buffer for the rating over the next few quarters because of the company's weakening cash flows and increasing capital expenditure, S&P said.

The company's technological upgrade of eight existing facilities since the third quarter of 2017 will weigh on its cash flows, the agency said.

It could also push up the company's capital expenditure by about RMB 1 billion, Moody's noted.

In addition, CJE's accelerating overseas expansion in developing countries like Indonesia and Brazil could constrain its credit profile, the agency said.

But the capacity upgrade may help the company meet the increasing demand for waste treatment in large cities due to the continuous net inflow of population, Moody's added.

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