Fitch Affirms Sri Lanka Telecom at ‘B+’/’AAA(lka)’
Fitch Ratings has affirmed Sri Lanka Telecom PLC's (SLT) Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs) at 'B+' and its National Long-Term Rating at 'AAA(lka)'. The Outlook is Stable.
SLT's IDRs are constrained by Sri Lanka's IDRs of 'B+', as the government directly and indirectly holds a majority stake in SLT and exercises significant influence on its operating and financial profile. SLT's second-biggest 44.9% shareholder, Malaysia's Usaha Tegas Sdn Bhd, does not have special provisions in its shareholder agreement to dilute the government's significant influence over SLT.
KEY RATING DRIVERS
Proposed Tax Credit Negative: Fitch believes SLT's 2018 operating EBITDAR margin could decline to 24% (2017 forecast: 29%) and its funds flow from operations (FFO) adjust...