Fitch: Winners and Losers if Indonesian Rupiah Continues to Fall
Fitch specifically highlights four corporates which are likely to benefit, and - conversely - 10 where financial profiles would deteriorate.
The report comes in the context of a 7.5% fall in the rupiah versus the US dollar during 1H15, and fears that a US tightening in 2H15 could result in further depreciation. This would stoke concerns that corporate credit profiles may deteriorate in Indonesia - particularly for those with debt, operating expenses and/or capex denominated in US dollars.
The report examines the impact of currency depreciation on both balance sheet and cash flow, and shows the resultant impact on net leverage (adjusted net debt/operating EBITDAR) for each corporate under both 15% and 30% currency depreciation scenarios. We then compare the results against our official negative rating triggers (for those corporates where we have assigned leverage rating triggers).
"Winners and Losers if the Indonesian Rupiah Continues to Fall" is available from www.fitchresearch.com.
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