(Repeat for additional subscribers)
Jan 28 (The following statement was released by the rating agency)
Fitch Ratings has given the final ranking on the a€˜B+a€™ the recovery rating a€˜RR4a€ on
the bonds of™ PT Alam Sutera Relaty Tbk (ASRI, a€˜B+a/ Stable) of USD 225 million with
a coupon of 9% and will mature in 2019. Bonds issued by the Natural Synergy Pte Ltd and ASRI and
guaranteed by certain subsidiaries.
Bonds are given the same rank with the senior unsecured debt rating
ASRI because these bonds are direct obligations of the company reflects,
unconditional, unsecured, and subordinated. this ranking
following the receipt of final documentation in accordance with the information that has been
previously received. The final rating in accordance with the expected rating
given on January 7, 2014.
Proceeds of the bonds will be used to finance the repurchase
bonds amounting to USD 150 million, which will mature in 2017, the project development
and construction, the purchase of the rest of the 2017 bonds in 2015, and to
general corporate purposes.
Factors Supporting Rating
Small Scale, Diversification Project: rating scale reflects the effort ASRI
small, the concentration of projects and volatility inherent in the development of business
property. Previously, more than 50% of sales come from marketing
ASRI housing project in Serpong, a satellite town located in the western part
from Jakarta. Fitch expects the company will gradually have
more diversified business portfolio with development projects
ASRI second dwelling on the Market Thursday. Management estimates market will Chemish
contributed approximately 43% of total sales marketing in 2013 (2012:
Stability in Central Challenges: Year 2014 will be a year full of
challenges for the development of business property upper middle class, such as
ASRI project in Serpong, with tighter mortgage rules and elections
investor sentiment will come lose. Fitch expects sales
higher marketing at Market Thursday and stable recurring income
from shopping malls and cultural parks will be able to fill sales
lower marketing in Serpong.
Thursday market has a strategic role in capturing demand
stable of buyers lower middle segment, with a more affordable price
and first home buyers are excluded from tighter mortgage rules.
Fitch expects sales from Thursday Market, which is located about 15 km from
Serpong will provide income stability for ASRI.
Exacerbating the weakening Rupiah Mismatch: Property developers with loans in
USD currency negatively impacted by the weakening Euro, where it is
increasing the burden of debt to currency sales. The weakening of the Rupiah
marketing and sales significantly lower than estimates have
ASRI worsen the debt ratio as measured with presales / gross debt (2013F:
0.95x). Nevertheless, Fitch expects to be able to keep the profile ASRI
debt according to rank, with presales ratio / gross debt was
0.75x for the period over the next 12 months, which supports the outlook Stable.
Debt repayment profile is well distributed is also a factor
additional support, with the maturing debt profile is extended to 2019
and subsequent to the issuance of new bonds.
Good Track Record: The rankings also take into account the land bank has ASRI
relatively inexpensive and broad, strategic location of the project, and project execution
successful. ASRI is one of the pioneers in developing occupancy in
large scale in Serpong, which is now a popular alternative to the area
another in Jakarta. Fitch believes ASRI will be able to continue to take advantage of a story
success in Serpong to launch another project in the future, such as the
has been shown with higher sales than expected in the Market
Negative: future developments that may, individually and collectively,
triggering the decline include:
- Improved and sustainable debt ratios, where the ratio of presales / gross
debt is below 0.75x on an ongoing basis (2014F: 0.80x)
- Increased exposure to other businesses (non-core)
Positive: Increased levels are not expected because of the nature of business expansion
the cyclical properties, small-scale business enterprises, and diversification