By The Nation
At the same time, TRIS assigned the rating to PSH’s proposed guaranteed debentures of up to Bt3,500 million at “A”.
The debentures are unconditionally and irrevocably guaranteed by Pruksa Real Estate (PS); PSH’s subsidiary, rated “A” with a “stable” outlook by
The guaranteed debentures are ranked pari passu to PS’s senior unsecured debentures.
The new issue rating replaces the issue rating previously assigned on February 28, 2019, following PSH’s request to increase the issue size to up to Bt3,500 million, from Bt2,500 million. The proceeds from the proposed debentures will be used to replace debentures issued by PS maturing in March 2019 and for working capital.
The ratings reflect PSH’s creditworthiness as the holding company of the Group. PSH’s major subsidiary is PS, in which PSH holds a 98.23 per cent equity stake. The ratings are based on the significant stream of dividends PSH receives from PS.
After the reorganisation in 2016, PS’s residential property business remains a major revenue contributor of PSH. As a result, PS is considered as a “core” subsidiary of PSH. Therefore, the issuer ratings of PSH and PS are equivalent.
The ratings of PSH take into consideration the strengths of PS in the residential property market. PS’s competitiveness is derived from its relatively diversified product portfolio, cost competitiveness, and large backlog partly securing the company’s future revenue stream.
The ratings also take into consideration the Group’s moderate financial leverage level, the cyclicality and competitive environment in the residential property development business, and the impact from the introduction of new loan-to-value (LTV) rules by the Bank of Thailand.