Property giant Ayala Land Inc. is planning to raise P10 billion from a planned issuance of fixed-rate bonds mainly to refinance maturing debt.

Philippine Rating Services Corporation (PhilRatings) said it has assigned the highest Issue Credit Rating of PRS Aaa, with a Stable Outlook, for ALI’s proposed issuance. 

This will be the sixth issuance in relation to the Company’s 2019 Securities Program (SP) of up to P50.0 billion. 

Net proceeds from the proposed bond issuance will be used to partially finance the early redemption of the Company’s P8.0 billion fixed-rate bonds maturing in April 2025 and for general corporate requirements as may be determined from time to time.

Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong. 

On the other hand, a Stable Outlook is assigned when a rating is likely to be maintained or to remain unchanged in the next 12 months. 

PhilRatings said the rating and outlook were assigned given ALI’s well-diversified portfolio, with a sizable and strategic land bank for future expansion, complemented by solid brand equity.

It also noted the firm’s highly experienced management team and synergies with the strong Ayala Group and ALI’s successful introduction of the first real estate investment trust (REIT) in the country despite the ongoing COVID-19 pandemic, providing it with an additional source of liquidity.

Also considered for the rating is ALI’s significantly tempered profitability amidst the COVID-19 crisis, with profitability seen to be on a path to recovery beginning 2021; and its ample capital structure and liquidity buffers to weather the ongoing pandemic.

While its 2020 figures were lower, ALI saw substantial improvements from the third quarter of 2020 to the fourth quarter, particularly in revenues from property development (up 64 percent), malls (up 10 percent), and hotels and resorts (52 percent higher).

Moving forward, ALI expects recovery to start in 2021, led by the residential segment which will continue to be the largest revenue contributor. Plans and strategies are said to be in place as the Company prepares for a V-shaped recovery.


Source: Manila Bulletin (https://mb.com.ph/2021/03/12/ayala-land-raising-p10b-from-bonds-offer/?utm_source=rss&utm_medium=rss&utm_campaign=ayala-land-raising-p10b-from-bonds-offer)