Fitch rates Denway Motors BBB-

Fitch Ratings said it assigned China-based Denway Motors Ltd. BBB- senior unsecured foreign and local currency ratings.

The outlook is stable.

The ratings reflect the strong performance and market position of Denway's investments in the burgeoning automobile manufacturing sector and other auto-related businesses in mainland China, the agency said, including its strong joint venture with Japan's Honda Motor Co. Ltd. (A+), the Guangzhou Honda Automobile Co. Ltd.

Fitch said the ratings also acknowledge that Denway's financial performance has to date been almost entirely dependent on the nascent Chinese automotive market and in particular, its long-term partnership with Honda, albeit this level of dependence is likely to reduce somewhat over time as a result of the company's recent acquisition of a 49% stake in Guangzhou Automobile Group Component Co.

The ratings also incorporate the robust financial profile and extremely conservative capital structure of Denway, reflected in its net cash position of HK$2.44 billion at fiscal year 2004 and total adjusted debt/total adjusted capitalization of only 1.3%, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.