Singapore, April 13, 2018 -- Moody's Investors Service has taken a number of rating actions on
non-financial corporates in Indonesia that are also government-related
issuers. The rating actions follow its earlier announcement that
it has upgraded Indonesia's sovereign rating to Baa2 from Baa3.
As a result of the sovereign rating action, Moody's has upgraded
the issuer and senior unsecured ratings of Pertamina (Persero) (P.T.)
to Baa2 from Baa3. The outlook on these ratings have been revised
to stable from positive.
At the same time, Moody's has affirmed the Baa1 issuer rating
of Telekomunikasi Indonesia (P.T.) (Telkom) and the Ba2
corporate family rating of Wijaya Karya (Persero) Tbk. (P.T.)
(WIKA). The outlook on these ratings is stable.
A list of each company's rating actions is included at the end of
this Press Release.
RATINGS RATIONALE
"Pertamina's ratings upgrade follows the upgrade of the sovereign
rating and reflects the company's strategically important position
as Indonesia's only national integrated oil and gas company.
Its baseline credit assessment (BCA) is affirmed at baa3,"
says Rachel Chua, a Moody's Assistant Vice President and Analyst.
"Telkom's rating is one notch above the rating of the sovereign
and reflects its standalone credit strength without any tangible uplift
due to government ownership. The rating reflects the company's
established position as Indonesia's largest integrated telecommunications
operator and an operating and financial profile reflective of a strong
investment-grade company," says Nidhi Dhruv, a Moody's
Vice President and Senior Analyst.
However, Telkom's rating is also constrained by an evolving acquisition
strategy, its exposure to Indonesia's competitive operating environment,
and the risk of intervention from the Government of Indonesia (Baa2 stable),
given Telkom is a majority state-owned company.
"WIKA's ratings are affirmed at Ba2 with stable outlook because
WIKA's rating already incorporates a two-notch uplift from
its b1 BCA, given our expectation that it will receive a moderate
level of extraordinary support from the Indonesian government in times
of need. Accordingly, an upgrade to the sovereign rating
does not automatically result in an upgrade of WIKA's rating,"
says Maisam Hasnain, a Moody's Analyst.
"WIKA's b1 BCA continues to reflects its leading market position
as one of the largest construction companies in Indonesia, with
an established track record of completing large projects, with a
sizeable order book that provides good revenue and cash flow visibility,"
adds Hasnain, also Moody's Lead Analyst for WIKA.
The principal methodologies used in rating Pertamina (Persero) (P.T.)
were Global Integrated Oil & Gas Industry published in October 2016,
and Government-Related Issuers published in August 2017.
The principal methodologies used in rating Telekomunikasi Indonesia (P.T.)
were Telecommunications Service Providers published in January 2017,
and Government-Related Issuers published in August 2017.
The principal methodologies used in rating Wijaya Karya (Persero) Tbk.
(P.T.) were Construction Industry published in March 2017,
and Government-Related Issuers published in August 2017.
Please see the Rating Methodologies page on www.moodys.com
for a copy of these methodologies.
Pertamina (Persero) (P.T.) is a 100% Indonesian government-owned,
fully-integrated oil and gas corporation, with operations
in upstream oil, gas and geothermal exploration and production,
downstream oil refining, marketing, distribution, transportation
and trading of petroleum products.
Telekomunikasi Indonesia (P.T.) (Telkom) is the largest
integrated telecommunications company in Indonesia. The company,
along with majority owned subsidiary, Telekomunikasi Selular (P.T.)
(Baa1 stable), generated gross revenue of IDR128.3 trillion
(approximately USD9.6 billion) for the 12 months ended 31 December
2017. Telkom is 52.1% owned by the Government of
Indonesia.
Established in 1960, Wijaya Karya (Persero) Tbk. (P.T.)
(WIKA) is one of the largest EPC companies in Indonesia with annual revenue
of around IDR26.2 trillion and an order book of IDR106.6
trillion as of December 2017. WIKA is 65% owned by the Government
of Indonesia, with the remaining 35% shares held by the public.
List of rating actions
.Issuer: Pertamina (Persero) (P.T.)
..Issuer Rating, upgraded to Baa2 from Baa3
..Senior Unsecured MTN Programme, upgraded to (P)Baa2
from (P)Baa3
..Senior Unsecured Regular Bond/ Debenture, upgraded
to Baa2 from Baa3
..Baseline Credit Assessment, affirmed at baa3
..Outlook is revised to stable from positive
Issuer: Telekomunikasi Indonesia (P.T.)
..Issuer rating -- Domestic Currency, affirmed
at Baa1
..Baseline Credit Assessment, affirmed at baa1
..Outlook is maintained at stable
.Issuer: Wijaya Karya (Persero) Tbk. (P.T.)
..Corporate Family Rating, affirmed at Ba2
..Senior Unsecured (Domestic) Rating, affirmed at
Ba2
..Baseline Credit Assessment, affirmed at b1
..Outlook is maintained at stable
REGULATORY DISCLOSURES
For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the credit rating action on the support provider and in relation to
each particular credit rating action for securities that derive their
credit ratings from the support provider's credit rating.
For provisional ratings, this announcement provides certain regulatory
disclosures in relation to the provisional rating assigned, and
in relation to a definitive rating that may be assigned subsequent to
the final issuance of the debt, in each case where the transaction
structure and terms have not changed prior to the assignment of the definitive
rating in a manner that would have affected the rating. For further
information please see the ratings tab on the issuer/entity page for the
respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this credit rating action,
and whose ratings may change as a result of this credit rating action,
the associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
The below contact information is provided for information purposes only.
Please see the ratings tab of the issuer page at www.moodys.com,
for each of the ratings covered, Moody's disclosures on the
lead rating analyst and the Moody's legal entity that has issued
the ratings.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Rachel Chua
Asst Vice President - Analyst
Corporate Finance Group
Moody's Investors Service Singapore Pte. Ltd.
50 Raffles Place #23-06
Singapore Land Tower
Singapore 48623
Singapore
JOURNALISTS: 852 3758 1350
Client Service: 852 3551 3077
Laura Acres
MD - Corporate Finance
Corporate Finance Group
JOURNALISTS: 852 3758 1350
Client Service: 852 3551 3077
Releasing Office:
Moody's Investors Service Singapore Pte. Ltd.
50 Raffles Place #23-06
Singapore Land Tower
Singapore 48623
Singapore
JOURNALISTS: 852 3758 1350
Client Service: 852 3551 3077
