Fitch Affirms Sunac at 'BB'
OREANDA-NEWS. Fitch Ratings has affirmed China-based property developer Sunac China Holdings Limited's (Sunac) Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB'. The Outlook is Stable. Fitch has also affirmed Sunac's senior unsecured rating and the rating on its outstanding USD400m 8.75% senior notes due 2019 at 'BB'.
Sunac started expanding rapidly in 2H15, and since then has entered 15 new cities through acquisitions and land auctions. The homebuilder maintained low leverage of 26.4% at end-2015, giving it the headroom for large-scale land acquisitions. However, as its leverage has surged in the past year, Fitch believes Sunac is exhausting its buffer and will closely monitor key ratios in 2H16 to see if further expansion will significantly increase the company's credit risks.