Lianhe Ratings Global Limited (“Lianhe Global”) has upgraded the global scale Long-term Issuer Credit Rating of Qingdao City Construction Investment (Group) Limited. (“QCCI” or “the company”) to ‘A+’ from ‘A’; The Outlook is Stable
The Issuer Credit Rating upgrade reflects the company’s increasing strategic importance in Qingdao and linkage with the Qingdao Municipal Government (“Qingdao government”), as the company is undertaking more significant urban renewal and urban construction projects under the guidance of the Qingdao government, and received strategic state assets in 2023. It is aligned with the development plans of the Qingdao government and strengthened QCCI’s role as Qingdao’s important urban comprehensive development and operating entity.
We believe this continues to present a high possibility that the Qingdao government would provide strong support to QCCI if needed, in light of the Qingdao government’s full ownership of QCCI, the high strategic importance of QCCI to Qingdao and the increasingly strong linkage between the Qingdao government and QCCI, including appointment and supervision of the senior management, strategic alignment, major investment and financing plan decisions, and ongoing government support. In addition, the Qingdao government may face significant negative impact on its reputation and financing activities should QCCI encounter any operational or financial difficulties.
Lianhe Global has also upgraded the global scale Long-term Issuance Credit Rating of the senior unsecured USD bonds and senior unsecured CNY bonds issued by QCCI’s wholly-owned subsidiary Hongkong International (Qingdao) Company Limited (“HKIQD”) to ‘A+’ from ‘A’ at the same time. QCCI shows its strong willingness to support HKIQD in meeting its debt obligations by offering a keepwell deed, a deed of equity interest purchase undertaking and an irrevocable standby facility agreement. A full list of affirmed issuance rating is included in this report.
The Stable Outlook reflects our expectation that QCCI’s strategic importance would remain intact while the Qingdao government will continue to ensure QCCI’s stable operation.