S&P: Shangdong Ruyi notes B-

S&P said it assigned a B long-term corporate credit rating to Shandong Ruyi Technology Group Co. Ltd. with a stable outlook.

The agency also said it assigned a B- long-term issue rating to senior unsecured notes of Prime Bloom Holdings Ltd., a wholly owned subsidiary.

S&P also said it assigned a cnBB- long-term Greater China regional scale rating to Shangdong Ruyi and cnB+ to Prime Bloom’s senior unsecured notes that Shangdong Ruyi unconditionally and irrevocably guarantees.

The ratings reflect the company's operations in China's highly competitive and fragmented textile industry that is exposed to volatile commodity prices, the agency said.

In addition, the company has weaker profitability than its international peers, S&P said.

The agency also said it expects the company's financial leverage to remain high due to its aggressive debt-funded expansion appetite.

Shangdong Ruyi's large operating scale, wide product offerings and satisfactory geographic diversification temper these weaknesses, S&P added.

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