Heze Cultural Tourism Investment Group Co., Ltd. (Initial Issuer Report)

Lianhe Ratings Global Limited (“Lianhe Global”) has assigned ‘BBB-’ global scale Long-term Issuer Credit Rating with Stable Outlook to Heze Cultural Tourism Investment Group Co., Ltd. (“HCTI” or “the company”)

The Issuer Credit Rating reflects a high possibility that the People’s Government of Heze City (“the Heze government”) would provide moderately strong support to HCTI if needed. This mainly considers the Heze government’s indirectly full ownership of HCTI, HCTI’s strategic importance as an important local investment and development company (“LIDC”) responsible for infrastructure construction and operation in Heze City (“Heze”), especially in the Caozhou Peony Garden and the linkage between the Heze government and HCTI, including the appointment of senior management, strategic alignment, supervision of major investment and financing decisions and ongoing operational and financial support. In addition, the Heze government may face negative impact on its reputation and financing activities if HCTI encounters any operational and financial difficulties.

The Stable Outlook reflects our expectation that HCTI’s strategic importance would remain intact while the Heze government will continue to ensure HCTI’s stable operation.