Pefindo: PT Medco Power Indonesia’s maturing bond and sukuk affirms at “idA” and “idA(sy)”

(April 27, 2021)-- PEFINDO has affirmed the ratings for PT Medco Power Indonesia (MEDP) maturing Bond I Year 2018 series A at “idA” and Sukuk Wakalah I Year 2018 series A at “idA(sy) totaling IDR399 billion. MEDP will fully repay its maturing bond and sukuk using a mix of internal cash and banks loan. As of December 31, 2020, the Company had a cash balance of IDR1.2 trillion. On top of that, MEDP has also secured a standby loan facility of IDR400 billion from banks.

Debt security rated idA indicates that the issuer’s capacity to meet its long-term financial commitments on the debt security, relative to other Indonesian issuers, is strong. However, the issuer’s capacity is somewhat more susceptible to adverse effects of changes in circumstances and economic conditions than higher-rated issuers.

A syariah based financing instrument rated idA(sy) indicates that the issuer’s capacity to meet its long-term financial commitments under the syariah financing contract, relative to other Indonesian issuers, is strong. However, it is somewhat more susceptible to adverse effects of changes in circumstances and economic conditions than higher-rated instruments.

Established in 2004, MEDP is an independent power producer (IPP) focusing on clean energy power plants, mainly gas and geothermal.

Its main business is to produce and supply power to state-owned electricity company, PT Perusahaan Listrik Negara (Persero) (PPLN, idAAA/Stable), especially in the western part of Indonesia. As of December 31, 2020, its power plants had a total installed capacity of 645 megawatts (MW), most of which are powered by gas and geothermal energy. It also provides operation and maintenance (O&M) services, with a total capacity of 1,925 MW, mainly through TJB Power Services. As of December 31, 2020, its shareholders were PT Medco Power Internasional (MPIN) (51%) and MEDC (49%).