Fitch rates Kcell BB

Fitch Ratings said it assigned a long-term issuer default rating of BB and a Kazakhstan national long-term rating of A(kaz) to Kcell JSC.

The outlook is stable.

Kcell is a market-leading mobile-only operator in Kazakhstan, Fitch said.

The company does not have a proprietary backbone network and lacks any broadband bundling options, which is a strategic weakness, the agency said.

Leverage is likely to remain moderate, but higher than the company's public target of up to 0.9x net debt-to-EBITDA, driven by continuing 4G and backbone investments in the medium term, Fitch said.

Competition in the Kazakh mobile market is likely to remain intense, but more rational than in 2015 and 2016, the agency added.

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