PEFINDO affirms “idCCC” rating to PT Sumberdaya Sewatama with “Negative” outlook
Tuesday, September 8 2020 - 02:13 AM WIB
(September 7, 2020)--PEFINDO has affirmed its “idCCC” ratings to PT Sumberdaya Sewatama (SSMM) and its Bond I/2012, and its “idCCC(sy)” rating to the Company’s Sukuk Ijarah I/2012. SSMM had restructured its outstanding debts on May 15, 2020, including its outstanding bond and sukuk, which the maturity date is now extended to December 31, 2034. We maintain a “Negative” outlook for its corporate rating to anticipate SSMM’s continued challenges to manage its liquidity during the uncertain growth of temporary power rental business and Coronavirus Disease (COVID-19) pandemic. We will closely monitor its debt and interest services, and evaluate the consistent business improvements post restructuring. Its bond and sukuk ratings could be lowered to “idD” if there are interest and/or principal missed payments on their respective due dates, while the corporate rating could be lowered to “idSD” if it defaults on any of its financial obligations but remains current on others.
An obligor rated idCCC is currently vulnerable, and dependent upon favorable business and financial conditions to meet its financial commitments.
The suffix (sy) indicates Islamic principles compliant.
The corporate rating reflects SSMM’s very weak financial profile and liquidity, its high dependence on a single buyer, and the uncertain growth of the temporary power rental business. The rating is offset by growing domestic demand for electricity in the medium term and its business synergy with its group.
SSMM’s business is classified into temporary power rental, operations and maintenance, and energy efficiency (pillar) services. It terminated its independent power producer (IPP) business in 2017. At the end of June 2020, PT ABM Investama Tbk held a 0.97% Series A stake in SSMM, PT Godra Investama Mandiri owned a 97.09% Series B stake and PT Tiara Marga Trakindo owned a 1.94% Series B stake. (ends)