Moody's revises Lenovo view to positive

Moody's Investors Service said it changed Lenovo Group Ltd.'s outlook to positive from stable and affirmed its Baa3 issuer and senior unsecured ratings.

"The positive outlook reflects our expectation that Lenovo will maintain its leading market position and improved EBITDA generation over the next 12-18 months, supported by favorable global demand prospects for personal computers (PC)," said Gerwin Ho, a Moody's vice president and senior credit officer, in a press release.

"In addition, we expect the company's continued disciplined financial management will help it to maintain its improved debt leverage, which is strong for its rating category, and its excellent liquidity," added Ho.

The agency said it forecasts Lenovo's adjusted EBITDA margin will be steady at about 5%-5.2% in the next 24 months from about 5% in fiscal 2021, mirroring greater economies of scale and improved profitability in its smartphone and server businesses.

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