Shandong Xintai Construction 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 Shandong Xintai Construction Group Co., Ltd. (“SXCG” or “the company”)

The Issuer Credit Rating reflects a high possibility that the People’s Government of Xintai City, Tai’an City (“Xintai government”) would provide very strong support to SXCG if needed, in light of its full ownership of SXCG, SXCG’s strategic importance as the key local investment and development company (“LIDC”) that is responsible for infrastructure construction and state-owned asset operation in Xintai City, Tai’an City (“Xintai”), and the linkage between the Xintai government and SXCG, 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 Xintai government may face significant negative impact on its reputation and financing activities if SXCG encounters any operational and financial difficulties.

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