Fitch downgrades Modernland Realty

Fitch Ratings said it downgraded PT Modernland Realty Tbk.’s long-term issuer default ratings to RD from C and then upgraded the rating to CC.

The initial downgrade to RD was prompted by the company’s announcement it completed the restructuring its Rp 150 billion domestic bond. The upgrade reflects the extended maturity of the bond to July 7, 2021, but the company’s liquidity remains poor, Fitch said.

It is highly likely the company will conduct another restructuring, Fitch said.

Fitch estimates Modernland may not have enough cash to meet its interest payments in the next few months, including the $8 million coupon due Aug. 30,” the agency said.

Fitch also upgraded the rating on Modernlan’s $150 million of unsecured notes due August 2021 and $240 million unsecured of notes due April 2024 to CC from C with a recovery rating of RR4.

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