Scope changes outlook on Market Építő rating to 'stable'
Scope Ratings has affirmed Hungarian construction company Market Építő's BB- issuer rating but revised the outlook to "stable" from "negative", Market Építő said in a disclosure posted on the website of the Budapest Stock Exchange.
In a separate statement, Scope said the rating action "reflects the lower-than-anticipated pressures on leverage and free operating cash flow in the context of the ambitious investment plan started in 2020".
It noted that Market Építő has expanded its growth strategy to invest in real estate projects and in a concrete plant. The ramp-up of the PreBeton concrete plant has allowed the company to source part of its raw materials internally, it added.
"The issuer rating is still supported by Market's leading position in the Hungarian construction sector and strong liquidity," Scope said.
"On the other hand, the rating remains constrained by Market's limited overall size, non-existent geographical diversification, and the concentrated backlog and business operations that result in a high sensitivity to business cycles," it added.
Market Építő made the disclosure because bonds it issued in the framework of the Bond Funding for Growth Scheme (BGS) of the National Bank of Hungary (MNB) are listed on the bourse.
The company issued a HUF 20 billion BGS bond in October 2019 and a HUF 22 bln bond a year later.
Policymakers Cut Central Bank Base Rate by 50 bp to 7.75%
Bulgaria's Household Income, Spending Rise 20% in 2023
Spar Magyarország Revenue Climbs Close to 16% in 2023
Hungary Launches HUF 15 bln Tourism Sector Support Program
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
