S&P raises Telkom, Indosat's ratings

S&P raises Telkom, Indosat's ratings

JAKARTA: PT Telkom, the nation's biggest telephone company, and rival PT Indosat had their foreign-currency debt ratings raised by Standard & Poor's, which cited growth prospects and political stability.

Telkom's and its mobile-phone unit PT Telkomsel's ratings were raised two levels to BB+. PT Indosat's debt rating was raised one step to BB, the ratings company said in a release. Indonesia is rated B+. All are junk ratings.

The ratings were raised after S&P increased Indonesia's transfer and convertibility risk assessment to BB+, three levels above the Southeast Asian nation's sovereign rating. The risk assessment shows if a government would restrict access to the foreign exchange needed to service debt, S&P said in the statement.

"Despite the varying degree of government ownership in these companies, there has been a track record of limited intervention by government," Yasmin Wirjawan, an analyst with S&P, said in the statement. "Standard & Poor's expects the government to continue to refrain from intervention in view of the competitive nature of the telecommunication industry." -- Bloomberg