TRIS Rating has affirms the company rating of EDL-Generation Plc and the ratings of the company’s senior unsecured debentures at BBB+.
At the same time, TRIS Rating revised the rating outlook of EDL-Gen to negative from stable. TRIS said the outlook revision reflects the integration of EDL-Generation with Electricite du Laos (EDL) and the Lao government and agency’s action on the sovereign rating of Laos.
Laos’ sovereign rating outlook was revised down to negative from stable on Monday, with the rating affirmed at BBB+.
TRIS said the BBB+ ratings continue to reflect the credit profile of EDL-Generation’s major shareholder and sole electricity off-taker, the state agency EDL.
EDL's credit profile as a state enterprise is underpinned by the sovereign rating BBB+ assigned by TRIS to Laos.
EDL-Generation’s ratings take into consideration the company’s strong market position in the Laos’ power industry and a capital structure adequate to support its expansion plan, TRIS said.
The ratings are partially constrained by the sovereign rating of Laos, EDL's funding needs for power network investments, an anticipated rise in EDL-Generation’s financial leverage from investment expansion, and exposure to hydrology risks in Laos, TRIS said.