Fitch ups China Resources Gas to A-

Fitch Ratings said it upgraded China Resources Gas Group Ltd.’s long-term issuer default rating and senior unsecured rating to A- from BBB+.

The outlook is stable.

Fitch said the issuer default rating incorporates a one-notch uplift for potential support from its immediate parent, China Resources Holdings Ltd. (CRH), which owns 64% of China Resources Gas. CRH is wholly owned by the State Assets Supervision and Administration

Commission of China (A+/stable).

The agency upgraded China Resources Gas’ standalone rating to BBB+ as its free cash flow after capex, dividends and acquisitions turned positive in 2017 while it consistently maintained a strong business profile and credit metrics, as well as disciplined capital spending. It has been able to pass through gas procurement cost to customers to maintain its dollar margin most of the time, despite some temporary delay in timing, Fitch explained.

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