Bangkok--Sep 18--TRIS
Thai Rating and Information Services (TRIS) announced Thursday, 18
September 1997, that it has downgraded the Aeronautical Radio of Thailand
Limited (AEROTHAI)'s corporate rating from AA to AA-
TRIS has removed the rating from CreditAlert, where it was placed
on 3 July 1997 after the Bank of Thailand altered the country's foreign
exchange regime from a basket of currencies to a managed float which was a
de facto devaluation of baht. TRIS based the downgrade on the country's
economic hardship in the wake of the sharp depreciation of the baht,
increasing inflationary pressure, the pronounced weakening of competitive
fundamentals and the social cost of to the austerity program required to
stabilize the economy and rebuild confidence. In conjunction with these
factors, the troubled financial institution system significantly increases
risks to monetary stability. The administration's commitment to
stabilization through the enforcement of the seven measures to revitalize
the Thai economy will be key to restoring the country's creditstanding.
AEROTHAI's rating continues to reflect its close ties to the
government, its strategic importance to the country, strong demand for air
transportation, efficient business operation and farsighted management.
However, nagative impact from future investments and increasing operating
costs will put more pressure on the company's financial strength.
AEROTHAI's efficient performance stems from its quality service, resource
development and competence in assisting neighbouring countries. AEROTHAI
has posted an overcollection since its flight charge restructuring in
October 1995. However, with future development of the CNS/ATM system and
operational expansion at the Bangkok international airport as well as the
new airport at Nongnguhao, AEROTHAI foresees subtantial investments of
over 3,000 million baht. The company is likely to employ debt financing
to meet its capital requirements because of its lack of financial support
from the government. Its gearing ratio is expected to increase. It cash
flow adequacy, funds from operations/total debts, would deteriorate partly
because of its non-profit status.
Note: Aeronautical Radio of Thailand Ltd. (AEROTHAI) TRIS's rating
Sr debt: Downgraded to AA-from AA
End.
Thai Rating and Information Services (TRIS) announced Thursday, 18
September 1997, that it has downgraded the Aeronautical Radio of Thailand
Limited (AEROTHAI)'s corporate rating from AA to AA-
TRIS has removed the rating from CreditAlert, where it was placed
on 3 July 1997 after the Bank of Thailand altered the country's foreign
exchange regime from a basket of currencies to a managed float which was a
de facto devaluation of baht. TRIS based the downgrade on the country's
economic hardship in the wake of the sharp depreciation of the baht,
increasing inflationary pressure, the pronounced weakening of competitive
fundamentals and the social cost of to the austerity program required to
stabilize the economy and rebuild confidence. In conjunction with these
factors, the troubled financial institution system significantly increases
risks to monetary stability. The administration's commitment to
stabilization through the enforcement of the seven measures to revitalize
the Thai economy will be key to restoring the country's creditstanding.
AEROTHAI's rating continues to reflect its close ties to the
government, its strategic importance to the country, strong demand for air
transportation, efficient business operation and farsighted management.
However, nagative impact from future investments and increasing operating
costs will put more pressure on the company's financial strength.
AEROTHAI's efficient performance stems from its quality service, resource
development and competence in assisting neighbouring countries. AEROTHAI
has posted an overcollection since its flight charge restructuring in
October 1995. However, with future development of the CNS/ATM system and
operational expansion at the Bangkok international airport as well as the
new airport at Nongnguhao, AEROTHAI foresees subtantial investments of
over 3,000 million baht. The company is likely to employ debt financing
to meet its capital requirements because of its lack of financial support
from the government. Its gearing ratio is expected to increase. It cash
flow adequacy, funds from operations/total debts, would deteriorate partly
because of its non-profit status.
Note: Aeronautical Radio of Thailand Ltd. (AEROTHAI) TRIS's rating
Sr debt: Downgraded to AA-from AA
End.