RusRating lowers AO Peresvet-Invest credit rating
OREANDA-NEWS.RusRating has lowered the credit rating assigned to AO Peresvet-Invest from "BBB+" to “BBB” on the national scale, confirming its rating on the international scale at “BB”. In both cases the outlook has changed from “stable” to “negative”.
The rating cut reflects the increased role of external liabilities to finance the Company’s operations and the high probability of a fall in revenues, due to a decline in effective demand for new residential real estate.
The negative outlook reflects the high probability of falling revenues across the Peresvet Group, again because of a decline in effective demand for new residential real estate.
The rating itself is based on affiliation with the GK Peresvet real estate group, a substantial planned project portfolio, successful past operations in the real estate market, and stable project financing.
Constraining factors include the Peresvet group’s non-transparent ownership structure plus a lack of consolidated accounts and the resulting limited financial transparency.
AO Peresvet-Invest is a full-cycle real estate developer that operates in the market for residential, suburban and commercial real estate, primarily in Moscow region. The Company is a member of the Peresvet group, which operates in both Moscow region and other parts of Russia, including Nizhni Novgorod, Volgograd, Rostov and Krasnodar regions. The planned project portfolio covers 1.3 million m2. The Company is owned by V.L. Melnik and O.V. Pronin.
Accounts payable and receivable on transactions with affiliated parties account for a large portion of the balance sheet, as do financial investments in GK Peresvet. Revenues are comparatively modest. Liquidity is sufficient, but future cash flow gaps are possible given the risk of falling revenues. Risk sensitivity is elevated.
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