Fitch Ratings affirmed Redco Properties Group Ltd.'s long-term foreign-currency issuer default rating and senior unsecured rating at B, with a stable outlook.
The rating agency said Sept. 26 the affirmation reflects its view that the Chinese property company's sales scale is still small relative to that of higher-rated peers, despite demonstrating consistent growth in attributable contracted sales in 2018.
Redco's ratings are driven by its small sales scale, higher leverage forecast, an expanding land bank and improved profit margin, Fitch added.
The rating agency said it will consider a positive ratings action if Redco continues to expand its scale, with attributable sales exceeding 20 billion yuan, while maintaining a saleable land bank life of at least 2.5 years and leverage of below 40%.
As of Sept. 26, US$1 was equivalent to 7.13 yuan.
