Looking Healthy

Ishara S. Kodikara | AFP | Getty Images Sri Lanka Prime Minister Ranil Wickremesinghe, center, speaks to supporters at the prime minister's official residence in Colombo on December 16, 2018, after he was reappointed as prime minister by Sri Lanka's president, the same man who fired him from the job nearly two months ago.

Fitch Ratings Lanka re-confirmed its SLAA+ national rating on John Keells Holdings Ltd. senior debt following the conglomerates recent acquisition spree.
SL AA+ rating denotes a very low expectation of credit risk. It indicates very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.rn

rnAfter picking up a 60 percent slice in Asian Hotels Corp. last Friday, JKH on Wednesday announced plans to raise around Rs. 6 bn through a combination of a private placement and rights issue of 1 for 7 on the increased share capital including the private placement. rn

rnThe increased equity would reduce JKHs Debt/Equity ratio to around 25 percent to 35 percent. As at June 30, JKHs Debt/Equity ratio was 55 percent. rn

rnFurthermore, other creditor protection measures of EBITDA/Interest and Total Debt/EBITDA would also improve to around 10(x) and 1.2(x) respectively, and are very comfortable for this rating category, says Fitch. rn