ASEAN KEY DESTINATIONS
Fitch upgrades PLDT credit rating outlook to stable
Philippines:Fitch Ratings has upgraded the credit rating outlook of PLDT Inc. on the basis of improved performance so far this year.
"Fitch Ratings has revised the outlook on PLDT Inc.'s Long-Term Local-Currency Issuer Default Rating (LC IDR) to stable from negative," the debt watcher said in a statement.
Fitch affirmed PLDT's LC IDR at "BBB+" which indicates that "expectations of default risk are currently low."
It also means that the company's capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity.
The stable outlook simply validated an improvement in the company's business, but won't have any significant impact on the business, AP Securities Equities Trader Frank Gerard J. Barboza said.
"But a fair point should be given to better outlook for the firm as TEL has somehow managed to slow the bleeding in its financials due to better data revenues on the back of increasing consumer demand for the service," he said.
"The revised ratings will not affect the company's business per se," he said in a text message.
PLDT shares are traded on the Philippine Stock Exchange using the ticker symbol TEL on big board.
Fitch cited the telco's improved business performance in the first half of the year, a bottom line that grew to P16.5 billion from P12.5 billion a year earlier.
"PLDT's credit profile reflects its strong position in both fixed and wireless markets in the Philippines, strengthening its status as an integrated telecom operator," it said.
"Fitch anticipates progressive EBITDA (earnings before interest, tax, depreciation, and amortization) improvements in the medium term," Fitch noted, citing the company's P70-billion EBITDA target this year.
Summit Securities Inc. President Harry G. Liu said "PLDT is a pillar to the market, so a recovery will boost the market index," he said.
"The mere fact they got a revised rating to stable means their financial status is stable. So they are improving their performance," Liu noted.
Shares of PLDT opened at P1,710 per shares on Thursday, unchanged from Wednesday's close.
Letters that do not contain full contact information cannot be published.
Letters become the property of AseanAffairs and may be republished in any format.
They typically run 150 words or less and may be edited
submit your comment in the box below