PEFINDO has assigned its idAA rating to PT Dian Swastatika Sentosa Tbk

(March 27, 2024)--PEFINDO has assigned its idAA rating to PT Dian Swastatika Sentosa Tbk (DSSA)’s proposed Shelf-Registered Bond and idAA(sy) rating for its proposed Shelf-Registered Mudharabah Sukuk of a maximum of IDR4.2 trillion and IDR2.8 trillion, respectively. The proceeds will be used for capital expenditure and working capital. PEFINDO has also affirmed DSSA’s rating at idAA with stable outlook. The corporate rating reflects DSSA’s very strong credit profile of its key investee (PT Golden Energy Mines Tbk or GEMS), conservative financial policy, and diversified asset portfolio. The corporate rating is constrained by its exposure to the energy transition risk and fluctuation of commodity price.

The rating may be raised if DSSA diversifies and strengthens its cash inflows stream from its investees while maintaining its conservative capital structure. On the other hand, the rating may be lowered following significant deterioration of GEMS’ performance or higher than projected debt without being compensated by a stronger business profile, which will weaken its capital structure and cash flow protection measures on a sustained basis. Any significant shortfall in coal commodity price may also trigger to a rating downgrade.

DSSA is a holding company with subsidiaries engaged in coal mining, power generation, technology, and trading. DSSA is part of Sinar Mas Group, with shareholders as of end of September 2023 consisting of PT Sinar Mas Tunggal (59.90%), treasury stock (20.0%), and public (20.10%). (ends)