Pulp producers' ratings upgrade
Pulp producers' ratings upgrade
JAKARTA (JP): Local rating agency PT Pemeringkat Efek
Indonesia (Pefindo) has upgraded the rating of rupiah bonds
issued by three local pulp and paper producers from idA minus to
idA.
Pefindo announced on Friday that it had improved the rating of
both PT Pindo Deli Pulp & Paper Mills' Rp 200 billion bonds and
PT Tjiwi Kimia's 200 billion bonds from idA minus to idA.
The rating agency said that it also assigned the same rating
to bonds each worth Rp 1 trillion to be issued by PT Lontar
Papyrus Pulp & Paper Industry and PT Pindo Deli Pulp and Paper
Mills.
"The idA rating given to Pindo Deli reflects the latter's
strong market position as a low-cost pulp and paper producer,"
the company said.
It said Pindo Deli had been able to boost its performance due
to the support of its holding company, the highly integrated Asia
Pulp & Paper Co. Ltd. Group.
Pindo Deli can also maintain its low-cost position with the
support of its subsidiary, Lontar Papyrus, it added.
Pefindo said that as a parent company to Lontar Papryus, Pindo
Deli had access to Lontar Papyrus' low-cost chipwood, labor and
transportation facilities owing to the latter's proximity to raw
material sources and end markets.
The rating company said the improvement of the ratings was
also made partly due to supportive external factors to both Pindo
Deli and Asia Pulp & Paper's operation.
Lontar Papyrus is a low-cost pulp producer and a key part of
the vertically integrated Asia Pulp & Paper Co. Ltd. Group, the
company said.
Pefindo said that when considering Lontar Papyrus' rating it
had also taken into account the group's aggressive financial
policy in funding expansion within the group.
The fact that Lontar Papyrus' pulp operation is well supported
by the high degree of vertical integration within the group has
resulted in the company's ability to compete both in local and
overseas markets, the rating company said.
"With Lontar Papyrus' involvement in producing value-added
products to support Asia Pulp & Paper Group's marketing and
distribution network, the company is expected to further
strengthen its market position," it added.
Pefindo said the third rating increase was extended to paper
and chemical company PT Pabrik Kertas Tjiwi Kimia's Rp 200
billion bonds from idA minus to idA.
The rating agency also assigned the idA rating to Tjiwi
Kimia's proposed Rp 1 trillion bonds.
"The ratings reflect Tjiwi Kimia's improved financial
performance, sustainable low-cost position and sales flexibility
in marketing its products worldwide," Pefindo said. (cst)