Research Update: PT Kawasan Industri Jababeka Tbk. 'B' Rating Affirmed With Negative Outlook; Off CreditWatch

The shareholder dispute at PT Kawasan Industri Jababeka Tbk. (Jababeka) is likely to be protracted, with no immediate, direct, and tangible impact on the company's operating performance, capital structure, or liquidity. At the same time, the nine-month results of the Indonesia-based real estate developer suggest the company is still facing soft market conditions and having fairly thin EBITDA interest coverage. On Nov. 8, 2019, S&P Global Ratings affirmed its 'B' long-term issuer credit rating on Jababeka and the 'B' long-term issue rating on the company's guaranteed senior unsecured notes. We removed the ratings from CreditWatch, where they were placed with negative implications on July 9, 2019. The negative outlook on the issuer credit rating reflects the risk that Jababeka's EBITDA

...- The shareholder dispute at PT Kawasan Industri Jababeka Tbk. (Jababeka) is likely to be protracted, with no immediate, direct, and tangible impact on the company's operating performance, capital structure, or liquidity. - At the same time, the nine-month results of the Indonesia-based real estate developer suggest the company is still facing soft market conditions and having fairly thin EBITDA interest coverage. - On Nov. 8, 2019, S&P Global Ratings affirmed its 'B' long-term issuer credit rating on Jababeka and the 'B' long-term issue rating on the company's guaranteed senior unsecured notes. We removed the ratings from CreditWatch, where they were placed with negative implications on July 9, 2019. - The negative outlook on the issuer credit rating reflects the risk that Jababeka's EBITDA interest coverage could stay thin at below 1.5x over the next six to 12 months amid protracted soft operating conditions and steady capital spending....

Research Update