JAKARTA: PT Fitch Ratings Indonesia rated PT Sulfindo Adiusaha's dollar-dominated bond issuance plan 'B'.The integrated chlorine-alkali producer will issue bonds through its subsidiary, Sulfindo Netherlands BV, and is fully guaranteed by Sulfindo which was previously called PT Indo Chlor Prakarsa Industries.Sulfindos credit profile was limited by its small plant as it only has one location, restricted geographic area and minimum product diversification, said Jeong Min Pak, Senior Director Fitch for Asia-Pacific Corporates team, this afternoon.He further said that the companys rating shall be confirmed once the company delivers the complementary document regarding the result of such dollar-denominated bond issuance.The rating agency also noted the companys plan to build a power generatorto weigh on Sulfindos capital expenditure over the next two and three years. Fitch further highlighted that the company will be influenced by the high cycle in the chemical industry, as it will be prone to Indonesian economic cycle, product volatility and the ups and down in raw material prices and volume.Jeong Min Pak claimed that the company is supported by several factors, including Sulfindo's position as one of integrated chlorine-alkali producers in Indonesia. Another factor is Sulfindos strong market share in the chlorine-alkali industry and PVC products, as well as the industrial fundamentals and the companys rising profitability.The rating agency also predicts the companys performance to rise this year, yet its high capital expenditure over the next 2-3 years to build power generator will result in a slump of its credit leverage until 2012. The credit level is estimated to be improved after the completion of the power generator construction.Fitch also estimates Sulfindos EBITDAR (Earnings Before Income Tax, Depreciation, Amortization, and Restructuring Costs) to be below three times. Sulfindos EBITDAR/gross interest will be maintained above two times over the next 2-3 years following the companys stable rating prospect.Fitch sets Sulfindos rating at B level with stable prospect. (T02/NOM)
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