...Fitch Ratings has revised Russian diamond producer PJSC ALROSA's Outlook to Positive from Stable, while affirming the company's Long- and Short-Term Issuer Default Ratings (IDRs) at `BB+' and `B', respectively. ALROSA Finance S.A.'s senior unsecured rating has also been affirmed at `BB+'. The revised Outlook reflects our reassessment of the linkage between ALROSA and the Russian Federation (BBB- /Positive) under Fitch's Government-Related Entities (GRE) Rating Criteria. Specifically, ALROSA's linkage with the state would justify a single-notch uplift to its standalone credit profile (SCP), which in our view is commensurate with a `BB+' rating. However, the methodology caps the possible uplift at the government IDR minus 1, ie `BB+'. We are therefore likely to upgrade ALROSA's IDR to `BBB-' if Russia is upgraded to `BBB'. ALROSA's `BB+' SCP is underpinned by a strong business profile and by our expectation that the deleveraging achieved since end-2016 will be sustained over 2018-2020. We...
