Operations in a highly competitive and fragmented auto retail industry in China. Exposure to highly volatile energy and cyclical property segments. Satisfactory market position. Extensive nationwide network and diversified offering. High financial leverage due to aggressive debt-funded expansion and appetite for acquisitions. Less than adequate liquidity due to a significant amount of short-term debt maturities. The stable outlook on Xinjiang Guanghui Industry Investment (Group) Co. Ltd. (Guanghui) reflects S&P Global Ratings' expectation that the company will continue to shift its focus to higher-margin after-sales services and maintain its satisfactory market position in China's auto retailing market over the next 12 months. These factors would support its cash flow generation. However, we expect Guanghui's leverage will remain high, due to its
