Post by account_disabled on Dec 27, 2023 9:41:07 GMT 2
Fitch Ratings (Thailand) Co., Ltd. has announced the National Long-Term Rating for HMC Polymers Co., Ltd. (HMC), a producer of polypropylene plastic resins. Lean (PP) at 'A-(tha)', credit outlook is negative. HMC's National Long-Term Rating of 'A-(tha)' includes a one-notch upgrade from HMC's Standalone Credit Profile of 'bbb+(. tha)', which reflects the moderate relationship between the Company and PTT Global Chemical Public Company Limited or PTTGC (Rating 'AA+(tha)', Outlook Negative; The standalone credit status is 'aa-(tha)'), which is the largest shareholder of HMC, holding 41 percent of the shares, according to the credit rating criteria for Parent and Subsidiary Rating Linkage. HMC's standalone rating reflects its leadership in the PP business in Thailand, its leadership in technology and product development, which makes the company It can focus on producing value-added products.
However, the rating is weighed down by limited product diversification. Fluctuations in the Country Email List petrochemical business and the company's debt ratio that is expected to be at a moderate level The credit outlook is negative. Reflecting the risk that the company's debt ratio It may decrease more slowly than expected. After large investments in 2020-2021 due to weak demand due to the coronavirus situation, Fitch expects the company's leverage ratio Measured by the ratio of net debt to operating cash flow before changes in working capital (FFO Net Leverage), it will increase to more than 4.5 times in 2020-2021 due to investment in the construction of PP line 4 and cash flow from Weak operations Fitch expects leverage to drop to below 3.5x by 2022 due to improved cash flow. from higher profits resulting from the expansion of production capacity and improved demand and price differences between petrochemical products and raw materials.
After the coronavirus situation, however, HMC's leverage may remain above 3.5 times if demand and spreads between petrochemical products remain low. From the weak economic situation after 2021 Factors affecting credit rating Leader in PP business in Southeast Asia: HMC is the first and largest PP producer in Thailand. With a market share of approximately 33 percent in 2019, the company is also one of the leaders in the PP business in Southeast Asia. The Company's PP production capacity will increase to approximately 1.1 million tonnes per year in 2022 after PP line 4 is completed, which will make the Company the largest PP producer in the region. In addition, the Company's market position also received additional factors from the company Focus on products that are different and have unique characteristics. Including the production of some raw materials Propylene is produced from the Propane Dehydrogenation (PDH) plant.
However, the rating is weighed down by limited product diversification. Fluctuations in the Country Email List petrochemical business and the company's debt ratio that is expected to be at a moderate level The credit outlook is negative. Reflecting the risk that the company's debt ratio It may decrease more slowly than expected. After large investments in 2020-2021 due to weak demand due to the coronavirus situation, Fitch expects the company's leverage ratio Measured by the ratio of net debt to operating cash flow before changes in working capital (FFO Net Leverage), it will increase to more than 4.5 times in 2020-2021 due to investment in the construction of PP line 4 and cash flow from Weak operations Fitch expects leverage to drop to below 3.5x by 2022 due to improved cash flow. from higher profits resulting from the expansion of production capacity and improved demand and price differences between petrochemical products and raw materials.
After the coronavirus situation, however, HMC's leverage may remain above 3.5 times if demand and spreads between petrochemical products remain low. From the weak economic situation after 2021 Factors affecting credit rating Leader in PP business in Southeast Asia: HMC is the first and largest PP producer in Thailand. With a market share of approximately 33 percent in 2019, the company is also one of the leaders in the PP business in Southeast Asia. The Company's PP production capacity will increase to approximately 1.1 million tonnes per year in 2022 after PP line 4 is completed, which will make the Company the largest PP producer in the region. In addition, the Company's market position also received additional factors from the company Focus on products that are different and have unique characteristics. Including the production of some raw materials Propylene is produced from the Propane Dehydrogenation (PDH) plant.