US-based international credit ratings agency Fitch has upgraded the long-term foreign-currency issuer default ratings (IDR) of Naftogaz, Ukraine’s national gas holding to from ‘B-’ to ‘B’ , changing the company’s outlook to positive, Interfax Ukraine has reported.
The upgrade follows a similar change in the sovereign credit ratings of Ukraine.
“Fitch equalises Naftogaz’s ratings with those of sovereign, reflecting the company’s strong links with the sovereign and our assessment of the company’s standalone credit profile (SCP) at ‘B-‘,” the agency said in a statement.
Naftogaz’s weak liquidity profile, but overall low leverage, some uncertainty related to domestic gas prices, the unbundling of the international gas transit business, as well as related political risk were all taken into account when making the decision.
According to Fitch, key rating drivers for Naftogaz include easing regulatory risks, favourable arbitration rulings regarding cases against Russian gas giant Gazprom, the company’s strong links to the state and overall economic expectations about Ukraine.