S&P rates IOI bonds BBB+

Standard & Poor's said it affirmed its BBB+ corporate credit rating on IOI Corp. Bhd. and assigned its BBB+ rating on the $370 million unsubordinated and unsecured zero-coupon exchangeable bonds issued by IOI's wholly owned subsidiary, IOI Capital Bhd. The bonds are unconditionally and irrevocably guaranteed by IOI.

The outlook is stable.

The rating reflects the strengths that include above-average financial profile, strong capitalization and cost efficiency, S&P said.

These strengths are offset by weaknesses, including the inherent industry risk in cyclical industries, price swings and changes in demand, the agency said. These risks are partly mitigated by the company's competitive cost position in palm oil plantations, low-cost land bank for property development and conservative leverage profile, S&P added.

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