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S&P Global Ratings Assigns the B+ Long-term Credit Rating to Setl Group

2017 june 08

The S&P Global Ratings agency has assigned the B+ long-term international credit rating to the Setl Group. The rating change outlook is "Stable". Currently, there are no development companies in Russia, whose international rating would be higher than the B+ that has been assigned to the Setl Group (B1 according to the comparable international scale). S&P Global Ratings has noted the long-term growth of Setl Group's profit: the volume of revenue has increased from 20 billion rubles in 2013 to 61 billion rubles in 2016. According to analysts, positive rating factors are the focus of the company on the broad target market, the significant amount of land and the effective apartment sale network, represented by its own real estate agency. According to international estimates, Setl Group holds one of the most significant market shares in St. Petersburg and Leningrad Region – 14% of the commissioned property in 2016. All in all, from the moment of its foundation, the company completed the construction of and commissioned more than 3.5 million square meters of the total area of residential and commercial real estate. Setl Group is one of the three major developers in Russia. In 2016, the revenue of the holding company amounted to 61 billion rubles (about 1 billion dollars). The estimate of Setl Group’s financial risk profile reflects the expectations of the agency's baseline scenario for high debt-cover and times-interest-earned ratios in 2017-2018, with which the debt/EBITDA ratio will be less than 1.5x, and the EBITDA interest coverage ratio will be about 6x. The agency forecasts a Setl Group’s revenue growth by 15% in 2017 and a stable revenue in 2018. The Stable outlook reflects the adequate liquidity figures and the agency's opinion that strong figures of interest expenses coverage by profit will help maintain the company's creditworthiness at the current level. According to S&P Global Ratings’ forecasts, the stable business model of the holding company will allow it to remain competitive and to further demonstrate the same performance.

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Companies of Setl Group holding