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03.10.2007
Credit-Rating rates Ukrgaz’s upcoming issue at uaB-
Credit-Rating, a nationally recognized credit rating agency in Ukraine has today assigned UAH110.7m 2-year issue of registered housing bonds (C-G series) by Kiev-based Ukrgaz LLC (`Issuer` or `company`) a long-term credit rating of uaB- (uaB minus). Outlook on the rating is positive. The company`s principal activity is investment and construction. Today the company constructs a residential complex in the borough of Tchaiki, Kiev Oblast. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2003-2006 and 1H2007 as well as other inside information furnished by the company.
An obligor or a debt liability with uaB credit rating is characterized with the LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is extremely susceptible to adverse changes in commercial, financial and economic conditions. The plus (+) or minus (-) modifier denotes rating`s relative status within major categories.
A Positive outlook indicates that there is a possibility to upgrade the rating in the course of the year, on condition that the positive tendencies are maintained and that current risks are reduced.
Factors maintaining the credit rating
- The planned issue is to be redeemed by premises in 2 nd stage of Tchaika residential complex, situated in 1, Lobanovskogo str., borough of Tchaiki, with the 1 st stage of the complex being already complete. The 2 nd stage has been financed UAH6.6m as of Sep. 15, 2007.
- The Issuer is engaged in residential and commercial premises in the city of Kiev, where real estate prices and demand have been growing over the past few years.
Factors constraining the credit rating
- The land plot and a part of premises are to redeem bonds of A series are deposited under the bank`s loan.
- Risk imposed by the project size, in fact the Issuer plans to build 197.5K sq.m. of residential and non-residential premises; the size of two issues including the upcoming one amounts to UAH492.7m, with the Issuer`s equity accounting for UAH10.8m as of June 30, 2007.
- The Issuer does not have experience in bond issuing.
- Instability in legislation and tax environment controlling both the construction industry and project financing.
Information on all credit ratings assigned in accordance with the Ukrainian national scale may be found in REUTERS, BLOOMBERG and FTN MONITOR information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
