Moody's lowers Evergrande

Moody's Investors Service said it downgraded the corporate family rating and senior unsecured ratings of China Evergrande Group, the CFRs of Hengda Real Estate Group Co. Ltd. and Tianji Holding Ltd. and the backed senior unsecured ratings of Scenery Journey Ltd.

The affected ratings include:

• Evergrande's CFR, which has been downgraded to Ca from Caa1, and its senior unsecured ratings to C from Caa2;

• Hengda's CFR, which has been downgraded to Ca from Caa1;

• Tianji's CFR, which has been downgraded to C from Caa2; and

• Scenery Journey's backed senior unsecured ratings, which have been downgraded to C from Caa2.

The outlook remains negative.

“The downgrades reflect Evergrande's heightened liquidity and default risks given its sizable amount of maturing debt over the next 6-12 months,” said Cedric Lai, a Moody's vice president and senior analyst, in a news release. “The downgrades also reflect the weak recovery prospects of Evergrande's creditors, if there is a default.”

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