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China's top 107 firms see credit pressure
By Feng Jianmin |
September 15, 2012, Saturday
|
Print Edition
Print Edition
CHINA'S slowing economic growth will put financial pressure on the top 107 companies in the country, Standard & Poor's Ratings Services warned.
The credit conditions of the top companies, of which about 80 percent are state-owned entities, lagged behind the China's sovereign ratings and those of banks if government support is excluded from the calculation, S&P said in a report yesterday.
"State-owned entities have relatively high leverage and weak profitability," said S&P's credit analyst Christopher Lee.
If government measures are included, the top companies still have "fair-to-strong business positions to support their credit profile," he said.
The SOEs suffered from decreasing profits this year as China's economic growth slowed to three-year low. The combined profits of SOEs in the first seven months fell 13.2 percent annually to 1.2 trillion yuan (US$190.5 billion), according to data by the Ministry of Finance.
Of the 15 sectors, the top telecommunications as well as oil and gas firms ranked the best by credit strength, with strong competitive positions and minimal financial risks.
The credit conditions of the top companies, of which about 80 percent are state-owned entities, lagged behind the China's sovereign ratings and those of banks if government support is excluded from the calculation, S&P said in a report yesterday.
"State-owned entities have relatively high leverage and weak profitability," said S&P's credit analyst Christopher Lee.
If government measures are included, the top companies still have "fair-to-strong business positions to support their credit profile," he said.
The SOEs suffered from decreasing profits this year as China's economic growth slowed to three-year low. The combined profits of SOEs in the first seven months fell 13.2 percent annually to 1.2 trillion yuan (US$190.5 billion), according to data by the Ministry of Finance.
Of the 15 sectors, the top telecommunications as well as oil and gas firms ranked the best by credit strength, with strong competitive positions and minimal financial risks.
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