Fitch rates Haidilao, notes BBB

Fitch Ratings said it assigned BBB ratings to Haidilao International Holding Ltd. and its planned dollar-denominated senior unsecured notes. The notes’ rating is in line with Haidilao’s BBB senior unsecured rating.

“The ratings reflect Haidilao’s strong brand recognition as the largest Chinese cuisine restaurant-chain globally. Haidilao’s well-known brand and customer-centric approach have supported its rapid expansion while maintaining stable operating metrics, such as table turnover rate and restaurant-level profit margin. However, scale is a constraint, as higher-rated issuers have substantially higher fund flow from operation (FFO) generation,” Fitch said in a press release.

Haidilao will use the proceeds to expand its restaurant network, pay research and development costs and general working capital purposes.

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