The “Rating under review: developing” status has been assigned to the credit rating of PJSC “INGRAD” (hereinafter, INGRAD, or the Company) in view of mass media reports that the key shareholder will sell the Company to a new owner, which may change the degree of support.
The current credit rating of BBB+(RU) is based on the strong operational risk profile, as well as high assessments of profitability, liquidity, and cash flow. The rating is constrained by the very high industry risk of the residential development sector, medium size of business, medium leverage, and low coverage. At the same time, ACRA notes the high likelihood of support being provided by the main operating asset of the Company’s key shareholder (LLC ROSSIUM Concern), CREDIT BANK OF MOSCOW (ACRA rating A+(RU), outlook Stable).
INGRAD is one of the largest players in the residential real estate market of Moscow, the Moscow Region, and Russia as a whole. In 2023, INGRAD was fifth in the rating of developers in terms of housing commissioning in Moscow. According to statistics from the Unified Developer Resource (the YERZ.RF website), the Company commissioned more than 305,000 square meters of residential real estate in the Moscow area in 2023. The main shareholders of the Company are LLC ROSSIUM Concern and REGION Group.
POTENTIAL OUTLOOK OR RATING CHANGE FACTORS
The “Rating under review: developing” status indicates a variety of trends: the rating may stay unchanged, be upgraded or downgraded.
Removal of the “Rating under review: developing” status and affirmation of the credit rating may be prompted by:
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Assessment of the new owner’s support high enough to affirm the credit rating;
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Maintaining the current ownership structure.
Removal of the “Rating under review: developing” status and downgrading the credit rating may be prompted by:
- Lower assessment of the new owner’s support.
Removal of the “Rating under review: developing” status and upgrading the credit rating may be prompted by:
- Higher assessment of the new owner’s support.
RATING COMPONENTS
Standalone creditworthiness assessment (SCA): bbb-.
Support: Group — SCA plus two notches.
ISSUE RATINGS
No outstanding issues have been rated.
REGULATORY DISCLOSURE
The credit rating has been assigned to PJSC “INGRAD” under the national scale for the Russian Federation based on the Methodology for Credit Ratings Assignment to Non-Financial Corporations under the National Scale for the Russian Federation, Methodology for Analyzing Rated Entities Associated with a State or a Group, and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities.
The credit rating of PJSC “INGRAD” was published by ACRA for the first time on September 6, 2021. The credit rating and its outlook are expected to be revised within one year following the publication date of this press release.
The credit rating was assigned based on data provided by PJSC “INGRAD”, information from publicly available sources, and ACRA’s own databases. The credit rating is solicited and PJSC “INGRAD” participated in its assignment.
In assigning the credit rating, ACRA used only information, the quality and reliability of which were, in ACRA’s opinion, appropriate and sufficient to apply the methodologies.
ACRA provided additional services to PJSC “INGRAD”. No conflicts of interest were discovered in the course of credit rating assignment.
