Fitch reviews BTS, Bangkok Mass Transit

Fitch Ratings (Thailand) said it placed BTS Group Holdings PCL’s and Bangkok Mass Transit System PCL’s national long-term ratings of A(tha) on Rating Watch Negative (RWN) following BTS Group's announcement of its investment in Bangkok's new urban rail projects.

On June 16, BTS Group signed the concession contracts – via its 75% stake in BSR Joint Venture – for the MRT Pink Line Project and the MRT Yellow Line Project, with the Mass Rapid Transit Authority of Thailand (MRTA) at an estimated total project cost of about 96 billion Thai baht.

The company is exploring options with regards to the financing structure of the two projects, which includes a mix of debt and equity financing.

Fitch said the negative watch reflects the uncertainties associated with the final financing structure, amidst limited financial flexibility.

The limited rating headroom of BTS Group and Bangkok Mass Transit reflects additional financing costs associated with Bangkok Mass Transit’s agreement to supply and install an electrical and mechanical system (E&M) for extensions to Bangkok's Green Lines, through to the financial year ending March 31, 2020, the agency added.

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