Fitch downgrades eHi

Fitch Ratings said it downgraded eHi Car Services Ltd.'s long-term issuer default rating to B- from B+ and its senior unsecured rating to B- from B+ with the recovery rating remaining at RR4.

“The downgrade reflects eHi's weakened financial flexibility. Liquidity tightened in 1H22 due to weaker operating cash flow following Covid-19 control measures and longer receivables collection, with additional outflows for upcoming VAT and debt repayments expected in 2H22. While there is some room for negotiating debt terms, particularly for finance leases used for vehicle purchases, Fitch expects the tighter liquidity has increased eHi's refinancing risk for its near-term maturities,” the agency said in a press release.

The outlook is negative.

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