Sinochem Hong Kong (Group) Co. Ltd.

Solid market position and good long-term demand prospects for core businesses. Strong sourcing and distribution capabilities supported by stable relationships with major players. Good business diversification and benefits from increasing vertical integration. Stable profitability in line with industry peers. Business transition and execution risks. High capital requirements. Negative free cash flows and high leverage. Adequate liquidity. The stable outlook on Sinochem Hong Kong (Group) Co. Ltd. (Sinochem Hong Kong) reflects our expectation that the company's parent Sinochem Group will benefit from its business diversity and maintain its financial performance over the next 24 months despite difficult operating conditions. We also expect the Chinese government to continue to provide very strong support to Sinochem Group. Significant capital expenditure in the group's

...Outlook: Stable The stable outlook on Sinochem Hong Kong (Group) Co. Ltd. (Sinochem Hong Kong) reflects our expectation that the company's parent Sinochem Group will benefit from its business diversity and maintain its financial performance over the next 24 months despite difficult operating conditions. We also expect the Chinese government to continue to provide very strong support to Sinochem Group. Significant capital expenditure in the group's energy segment and sluggish demand for fertilizer and chemicals in China's slowing economy are likely to constrain any improvement in the group's financial risk profile....

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