RIYADH: Fitch Ratings has revised Saudi Basic Industries Corporation’s long-term foreign-currency issuer default rating, IDR, to positive from stable and affirmed its A rating, following similar rating action on its majority parent Saudi Aramco.
“SABIC’s rating is aligned with that of its parent Saudi Aramco, reflecting the strength of the ties between the two companies in accordance with Fitch’s Parent and Subsidiary Linkage Rating Criteria,” Fitch said.
The credit agency revealed that SABIC’s rating reflects the company’s cost leadership and conservative financial profile.
Ratings agency Fitch on April 26 revised its outlook for state-owned Saudi Arabian Oil Co. to “positive” from “stable.”
The agency had raised its outlook on Saudi Arabia to “positive” from “stable” earlier this month on the back of improvements in the country’s sovereign balance sheet thanks to higher oil revenues.
“SABIC stands out among its ‘A’ rating category peers as it is a commoditised chemical company, albeit one with a leading cost position and access to low-cost feedstock in Saudi Arabia, which underpins strong profitability and robust cash flow generation through the cycle,” Fitch added.
The only other Fitch A-rated chemical company is German multinational BASF SE.
