S&P assigns BB- to PNC Investments

S&P said it assigned a BB- issuer credit rating to PNC Investments LLC (PNCI), which is the parent of Sobha, and a preliminary BB- to Sobha Sukuk Ltd.’s planned sukuk. The outlook is positive.

“PNCI benefits from favorable local economic and real estate sector trends in Dubai, where we expect the price trend to decelerate but demand to remain healthy despite the significant increase in new supply. After record pre-sales of AED 10.8 billion in 2022 (up from AED 4.4 billion in 2021), momentum continued to build in the five months to May 2023, with AED 6.2 billion in recorded presales for Sobha outpacing last year's trend. Sobha is set to witness another strong year in 2023, as it rides the wave of persistent demand,” S&P said in a statement.

The agency said it expects PNCI to lower the adjusted debt-to-EBITDA ratio to about 1x-1.2x by 2024.

PNCI plans to use the proceeds to refinance debt and for general corporate purposes.

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