Moody's affirms China Oriental

Moody's Investors Service said it affirmed China Oriental Group Co. Ltd.'s Ba1 corporate family rating and withdrew the Ba1 senior unsecured bond rating on the company's proposed dollar-denominated notes, as they have not been issued as planned.

The outlook remains stable.

The agency said it expects that the company will maintain its financial prudence, funding its capital expenditure with operating cash flow and available funds.

The rating reflects the company's position as the largest maker of H-sections in China, its sound credit profile and management's prudent financial philosophy, Moody's said.

Because of its lack of self-sufficiency in raw materials, the company is exposed to rising prices for iron ore and coking coal, as well as the industry and regulatory risk in China's steel industry, the agency added.

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