Research Update: Inner Mongolia Yili Industrial Group Assigned 'A-' Rating With Stable Outlook; Proposed Notes Rated 'A-'

Inner Mongolia Yili Industrial Group Co. Ltd.'s (Yili) well-known brands, effective product innovation, and distribution strategies will continue to support its position as the largest dairy company in Asia. Its minimal leverage and prudent financial policy also underpin its credit profile. The China-based company's concentrated exposure to China and weaker position in the highly competitive and more profitable yogurt and infant milk formula segments temper its strengths. On Nov. 10, 2020, S&P Global Ratings assigned its 'A-' long-term issuer credit rating to Yili. At the same time, we assigned our 'A-' long-term issue rating to the company's proposed guaranteed senior unsecured notes. The stable outlook reflects our expectation that Yili will grow at a high-single-digit percentage, achieve stable EBITDA margin

...- Inner Mongolia Yili Industrial Group Co. Ltd.'s (Yili) well-known brands, effective product innovation, and distribution strategies will continue to support its position as the largest dairy company in Asia. Its minimal leverage and prudent financial policy also underpin its credit profile. - The China-based company's concentrated exposure to China and weaker position in the highly competitive and more profitable yogurt and infant milk formula segments temper its strengths. - On Nov. 10, 2020, S&P Global Ratings assigned its 'A-' long-term issuer credit rating to Yili. At the same time, we assigned our 'A-' long-term issue rating to the company's proposed guaranteed senior unsecured notes. - The stable outlook reflects our expectation that Yili will grow at a high-single-digit percentage, achieve stable EBITDA margin of 9%-11%, maintain leverage below 1.0x, and generate positive free cash flow over the next 18-24 months....

Research Update