Rating Upgrade for Japfa; Another Downgrade for Gajah Tunggal
The were two rating action over the week; 1) Fitch rating upgraded Japfa Comfeed Indonesia, Tbk’s (JPFA IJ) to AA-(idn)/Stable from A+(idn)/Negative and 2) Gajah tunggal, Tbk (GJTL IJ) suffered another rating downgrade at Moodys’ with its rating slashed to B3 from B2 with negative outlook. Similar to S&P, the downgrade was caused mainly by rising refinancing risk on the company’s USD500Mn senior secured notes due 2018. The company will need to seek for external funding either executing loan facility from banks, issuing IDR bonds or launching new USD bond that would incur high cost of funds.
Delta Dunia’s Capex of USD190Mn in 2018
Bondholder Approved Indika Energy’s Consent Solicitation
BNI Banks Issued IDR3trn Bonds
Indonesia Foreign Reserve Climbed 2.34% amid Strengthening Rupiah
Indonesia’s Foreign Reserves above USD130Bn as of December 2017
Meanwhile, the upgrade on Japfa was driven by several factors including; i) government intervention to manage oversupply in poultry industry which had weakened prices for day-old chicks (DOC) and live birds in 2H14 and 1H15 ii) higher profitability with lower leverage, as reflected by its EBITDA margin that widened to 14.5% in 9M16 (2015: 9.1%) and net debt-to-EBITDA leverage decreased to 0.9x (2015: 2.6x) amid improved market condition, iii) better liquidity position after issuing IDR1trn bonds in November 2016 and additional cash injection of IDR702bn from from KKR August 2016. Therefore, these should allow Japfa to meet the maturities of IDR1.5trn of bonds in January and February 2017. Nevertheless, Japfa’s strong credit metric and wide access to funding source should ease the company to raise additional cash in the future.
Selamat Sempurna Acquire 44% Stake in Distributor’s Share
WOM Finance Financing Reached IDR2.2Trn in 2016
Hanson International Rated at BBB and Bank Sinarmas at A
Indonesia 4W Retail Vehicle Sales Increased by 14.5% YoY in 5M18
Government Cuts 2019 Growth Projection to be more Realistic
