Fitch Ratings gives a positive assessment of Uzbekhydroenergo’s creditworthiness
The financial stability of energy enterprises, their ability to meet debt obligations on time, and their production potential are key criteria in international credit rating assessments. These factors are reflected in the latest creditworthiness assessment of Uzbekhydroenergo JSC conducted by Fitch Ratings.
Fitch Ratings has revised Uzbekhydroenergo JSC’s Outlook to Stable from Positive, while affirming its Long-Term Issuer Default Rating (IDR) at ‘BB’. The company’s Standalone Credit Profile (SCP) remains ‘b+’.
The Outlook revision reflects changes to the rating construction under the Government Related Entities (GRE) Criteria. They no longer automatically equalize the ratings with the Republic of Uzbekistan (BB/Positive), due to an expected decrease in the share of state-guaranteed debt. The revised GRE support score of 30 remains consistent with an equalized rating although the rating will not necessarily move in tandem with the sovereign rating.
UGE’s SCP is still negatively affected by low tariff visibility and constrained by their operating environment (OE) assessment. Key strengths are a gradual increase in scale, a monopolistic position in hydro generation in Uzbekistan, high operating profitability and a prudent approach to leverage. UGE’S pre-OE SCP is currently assessed as ‘bb-’ but its post OE SCP is ‘b+’, affected by Uzbekistan’s OE score of ‘b+’. An improvement in the OE in Uzbekistan would lead to an upward revision of the SCP.
Nasiba Ziyodullayeva, UzA
