[ET Net News Agency, 8 April 2020] Moody's Investors Service has changed to stable from
positive the outlook on China Hongqiao Group Limited (01378). At the same time, Moody's
has affirmed Hongqiao's B1 corporate family and B2 senior unsecured ratings.
"The change in outlook to stable from positive reflects our expectation that Hongqiao's
earnings will weaken over 2020-21, amid increasingly challenging market conditions and
rising aluminum price volatility," said Roy Zhang, a Moody's Vice President and Senior
Analyst.
The rapid and widening spread of the coronavirus outbreak, deteriorating global economic
outlook, falling oil prices, and asset price declines are creating a severe and extensive
credit shock across many sectors, regions and markets. The combined credit effects of
these developments are unprecedented. More specifically, Hongqiao's exposure to commodity
and manufacturing have left it vulnerable to shifts in market sentiment, given its
sensitivity to end demand. (KL)