S&P revises Country Gardens view to positive

S&P said it revised the outlook for Country Garden Holdings Co. Ltd. to positive from stable.

“We revised the outlook to positive because we believe China-based property company Country Garden is building a stronger track record of operational stability, particularly in its profitability. This is key for the rating to be commensurate with that on higher-rated peers,” S&P said in a press release.

“Moreover, because the company is no longer chasing scale growth fueled by debt, its debt level should stabilize and leverage could improve,” the agency said.

S&P said it forecasts a debt-to-EBITDA ratio of 3.5x-3.8x over the next two years, from 3.5x at end-2019 and 3.9x at end-2018.

The agency also affirmed Country Garden’s BB+ issuer rating.

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