PEFINDO has raised its ratings for PT Jakarta Lingkar Baratsatu (JLBS) and its Bond I Series B to idAA- from idA+

(June 13, 2022)--The upgrade in rating reflects our expectation that JLBS will maintain a sound financial profile supported by the strong traffic from the Jakarta Outer Ring Road (JORR). The outlook for the corporate rating is stable.

The rating reflects JLBS’ strong traffic demand, solid profitability indicators, and strong financial profile. The rating is constrained by its exposure to traffic volume risk.

We see limited likelihood that the rating will improve over the next 12-18 months given JLBS’ concentration to a single toll road asset. The rating may be lowered if there is a significant decline in toll revenues due to reduced traffic volume and/or if it incurs additional debt resulting in a substantially higher leverage than we anticipated.

JLBS was established in 1995 and commenced operating the 9.9-kilometer JORR-W1 (Kebon Jeruk-Penjaringan) toll road in February 2010. The concession period will expire on February 2, 2042. Following the JORR integration in September 2018, JLBS’ revenue is derived from a revenue sharing scheme with other JORR operators accounting for 15.32% of the overall JORR revenue. As of March 31, 2022, its shareholders consisted of PT Bangun Tjipta Sarana (64.8%), PT Marga Utama Nusantara (35.0%), and PT Reka Daya Adicipta (0.2%). (ends)