PLN bond gets ?B? rating from Pefindo rating agency

Indonesian rating agency PT Pefindo has assigned ?B? rating on bonds issued by state electricity company PLN, Neraca daily reported on Monday.

The rating agency said that the rating reflected the improvement of the state electricity cash flow as the result from the recent increase in the electricity tariffs and the good progress in its debt restructuring.

The new rating was also factored by the improvement of the exchange rate of the rupiah against the U.S. dollar. Last year, dollar spending accounted for about 72 percent of the company?s total expenditure.

According to Prfindo, the cash flow of the state electricity company reached about Rp 6 trillion at the end of the first quarter of this year. Of the total, about Rp 4,7 trillion were in the form of the government?s subsidies.

The government?s approval on the restructuring of the company?s debts would also bring a positive impact on its overall financial performance. Under the new restructuring plan, PLN?s debts of about Rp 5.22 trillion to the government have been extended to 20 years, with a grace period of 2 years. (*)