FRIDAY, March 29, 2024
nationthailand

Siamgas and Petrochemicals rating set at “BBB+”

Siamgas and Petrochemicals rating set at “BBB+”

TRIS Rating has affirmed the rating on Siamgas and Petrochemicals PLC (SGP) and its existing senior unsecured debenture ratings at “BBB+”, the company said in a press release on Friday.

The company said TRIS Rating also affirmed the rating on its existing partially guaranteed debenture at “A+” for 85 per cent and “A” for 70 per cent guarantee of the unpaid amount of principal and interest. The Credit Guarantee and Investment Facility (CGIF) (AAA/Stable) is the guarantor.
At the same time, TRIS Rating assigned the rating of “BBB+” to SGP’s newly proposed issue of up to Bt3 billion in senior unsecured debentures. SGP will use the proceeds to replace an existing bond which will be due in February 2019.
The company said the rating continues to reflect the company’s strong position as the second-largest liquefied petroleum gas (LPG) distributor in Thailand, its robust domestic distribution network, and its geographically diverse customer base. 
The ratings, however, are partially offset by high business risk from SGP’s operations abroad which expose the company to fluctuations in LPG prices.
SGP’s financial result was better than TRIS Rating’s forecasts, thanks to the uptrend in LPG price. For the first nine months of 2018, SGP’s funds from operations (FFO) was about Bt2.4 billion. The annualised FFO to total debt ratio stood at 28.4 per cent, which was in line with our forecast. Under TRIS Rating’s base case assumption, SGP will generate the averaged FFO of Bt2.5 billon per annum and maintain the FFO to total debt ratio at over 20 per cent.

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