PEFINDO has affirmed its idA- ratings for PT Adhi Karya (Persero) Tbk

(8 June 2026)--PEFINDO has affirmed its idA- ratings for PT Adhi Karya (Persero) Tbk (ADHI), its shelf-registered (SR) bond III, and SR bond IV. Outlook for ADHI’s corporate rating is revised to negative from CreditWatch with Negative Implications, following the Company’s ability to comply with the financial covenants of its SR Bond III Phase III/2022 based on the figures as of the end of March 2026. ADHI’s Negative Outlook reflects our view on ADHI's persistently fragile financial profile given its still-elevated leverage, the uncertain timeline for cash collection from completed government projects and the realization of its asset divestment.

The corporate rating reflects our view of its important role for the government, ADHI’s strong market position, and its benefits as a state contractor. The rating is constrained by its high leverage, execution risks related to ADHI’s growing order book, and a volatile business environment.

The rating could be lowered if ADHI’s deleveraging stalls such that leverage and coverage metrics remain weak for the rating category on a sustained basis. The rating could also be under pressure if there is evidence of weaker support from the government, reflected by substantial divestment or a lower span of control, or there is a lack of indication of extraordinary support from the government when ADHI is under financial distress. We may revise the outlook back to stable without a rating downgrade if the Company demonstrates a clear and sustained deleveraging path, supported by verified cash inflows from outstanding receivables on completed projects and the execution of binding divestment agreements on its investment portfolio.

Established in 1960, ADHI is a state-owned contractor company primarily engaged in providing construction services. Its business is classified into four main segments: construction, engineering, procurement, and construction (EPC), property and realty, and investment infrastructure. As of March 31, 2026, PT Danantara Aset Management (Persero) holds a 64.3% of the Company’s shares, and the public owns the remainder. (ends)