Moody’s lifts West China Cement to Ba3

Moody's Investors Service said it upgraded West China Cement Ltd.’s corporate family and senior unsecured ratings to Ba3 from B1.

The outlook is stable. This action concludes the review initiated on June 19.

"The upgrade reflects the improvement in WCC's financial profile following the investment by Anhui Conch Cement Co. Ltd. (A3 stable) in the company," Moody's vice president and senior analyst Franco Leung said in a news release.

At the end of June 2015, Conch had completed a subscription to shares equivalent to a 16.67% equity stake in West China Cement. As a result, the company’s cash balance improved substantially to RMB 1.9 billion on June 30 from RMB 700 million at end-December 2014.

In addition, West China Cement’s debt/capitalization improved to 40% on June 30 from 45% at end-December 2014.

"WCC's improved financial position is important because market conditions have become more challenging with demand for cement falling because of lower infrastructure investments in Shaanxi Province," Leung added in the release. "The company's 1H 2015 results are indicative of this trend."

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