Moody’s revises outlooks for four Chinese property firms

Moody’s Investors Service said it revised the outlooks for the ratings of China Evergrande Group, Hengda Real Estate Group Co. Ltd., Tianji Holding Ltd. and Scenery Journey Ltd. to stable from positive.

Evergrande owns a 63.5% stake in Hengda and 100% of Tianji, which owns 100% of Scenery Journey.

“The revision of the outlooks to stable from positive reflects our expectation that the credit profiles of Evergrande and Hengda are likely to prove more in line with other B1-rated Chinese property peers over the next 12-18 months, due to slower-than-expected growth in revenue and contracted sales, and the slower pace of deleveraging,” said Josephine Ho, a Moody’s vice president and senior analyst, in a news release.

“The stable outlooks also reflect our expectation that Evergrande and Hengda will maintain their access to funding to refinance their maturing debt over the next 12-18 months,” she said.

Moody’s affirmed the corporate family ratings for Evergande, Hengda and Tianji. The corporate family rating for Evergrande and Hengda is B1. Tianji is rated B2. The agency also affirmed the B2 backed senior unsecured rating for Scenic Journey’s notes, which are guaranteed by Tianji.

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