Research Update: Rutas de Lima S.A.C. 'B-' Issue Rating Remains On CreditWatch Negative Amid Temporary Toll Suspension At Chillon

The Seventh Civil Court with Subspecialty in Commercial Matters of Lima (Court of Lima) recently admitted a precautionary measure to temporarily suspend collections at the Chillon toll plaza, located along the Panamerica Norte (PN) road, until a final decision is made. The suspension doesn't contemplate, at this stage, any compensation for Rutas de Lima (RdL). We therefore excluded toll collections from the Chillon plaza in our base-case scenario for 90 days (the tenor of the CreditWatch). We also incorporated a 15% toll increase derived by the inflation mechanism included in the concession agreement that was implemented on Jan. 30, 2024 at Panamericana Sur (PS) and a roughly 4% traffic increase during January. We now expect the project to have a

...- The Seventh Civil Court with Subspecialty in Commercial Matters of Lima (Court of Lima) recently admitted a precautionary measure to temporarily suspend collections at the Chillon toll plaza, located along the Panamerica Norte (PN) road, until a final decision is made. The suspension doesn't contemplate, at this stage, any compensation for Rutas de Lima (RdL). - We therefore excluded toll collections from the Chillon plaza in our base-case scenario for 90 days (the tenor of the CreditWatch). We also incorporated a 15% toll increase derived by the inflation mechanism included in the concession agreement that was implemented on Jan. 30, 2024 at Panamericana Sur (PS) and a roughly 4% traffic increase during January. We now expect the project to have a debt service coverage ratio (DSCR) close to 1.2x by December 2024. Moreover, under this scenario, we don't anticipate the project will use its reserve accounts to face financial obligations until at least 2029. - Therefore, on Feb. 15, 2024,...

Research Update