PEFINDO affirms rating of Jasa Marga

(November 14, 2023)--PEFINDO has affirmed the rating of PT Jasa Marga (Persero) Tbk (JSMR) and its Shelf Registered Bond II at idAA. Outlook for the corporate rating is stable. The rating reflects our expectation of strong government support, JSMR’s dominant position in the toll road sector, a diversified toll road portfolio with a long concession period, and very strong financial flexibility. The rating is constrained by business risks related to the development of new toll roads and its high leverage.

We may raise the rating if JSMR could strengthen its business profile substantially by successfully developing and operating new toll roads with strong traffic volume which supports the improvement in its financial profile, with lower leverage and stronger cash flow coverages. We may lower the rating if government support weakens or its financial profile deteriorates because of a severe drop in revenue due to a decline in traffic volume or if it incurs higher debt than projected without being compensated by favorable growth prospects.

JSMR is the largest toll road operator in Indonesia. Its portfolio includes 13 old toll road concessions at the parent company, 17 operated toll roads at subsidiaries, and 5 toll roads under construction. As of September 30, 2023, its shareholders were the Indonesian government (70%), BPJS Ketenagakerjaan (3.4%), BNYM RE BNYMLB RE Employee ProvidentFD (2.4%), PT Taspen (2.2%), and the public (22%). (ends)