Alam Sutera’s USD Notes Offer Upside on Refinancing Plan: Lucror

(Bloomberg) -- Recommends the Indonesian developer’s USD 2020 and 2022 bonds as a “speculative buy” as the company is addressing a refinancing risk that has weighed on its creditratings, Lucror says in a note Tuesday.

The 2020s will most likely be refinanced with the proceeds from issuance of new notes, giving a quick upside.

The 2022s are still trading relatively wide compared to local peers; Lucror prefers longer duration for better potential gain
should spreads compress.

Alam Sutera’s financial risk profile has improved, while most of its competitors have been impacted by the weak operating environment.

The company “is notable among high-yield real-estate issuers in that it is still doing well operationally”.

 

2019-01-15 02:44:37.808 GMT

By David Yong