Ningxiang Water Construction and Investment 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 Ningxiang Water Construction and Investment Co., Ltd. (“NWCI” or “the company”)

The Issuer Credit Rating reflects a high possibility that the People’s Government of Ningxiang City, Changsha City (“Ningxiang government”) would provide moderate strong support to NWCI if needed, in light of its indirect full ownership of NWCI, NWCI’s strategic importance as the key local investment and development company (“LIDC”) that is responsible for water-related infrastructure construction and operation, water supply, and utilization of water resources in Ningxiang City, Changsha City (“Ningxiang”), and the linkage between the Ningxiang government and NWCI, including appointment and supervision of the senior management, strategic alignment, major investment and financing plan decisions and ongoing operational and financial support. In addition, the Ningxiang government may face negative impact on its reputation and financing activities if NWCI encounters any operational and financial difficulties.

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