Fitch rates Bangkok Mass Transit notes A(tha)

Fitch Ratings said it assigned an A(tha) national long-term rating to Bangkok Mass Transit System PCL's senior unsecured debentures.

The debentures, totaling up to 20 billion in Thai baht, will be issued in multiple tranches with due dates up to 2026 and are rated at the same level as the company's national long-term rating, the agency said.

The proceeds will be used to fund the company’s mass transit business capital expenditures and investments, Fitch said.

The company does not have significant secured debt, the agency added.

The company’s national rating is aligned with the consolidated profile of its parent, BTS Group Holdings PCL due to strong operating and strategic linkages, the agency said.

Interest costs from additional debt associated with the company’s electrical and mechanical system project is expected to significantly reduce its debt-service coverage from cash flows, Fitch noted.

As such, any material increase in investments, weaker-than-expected cash generation in the medium term or a debt structure that adds high debt-servicing costs could lead to a negative rating action, the agency said.

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