TBIG – Secures Fitch ‘AA+(idn)’ rating

TBIG – Secures Fitch ‘AA+(idn)’ rating Tower Bersama Infrastructure (TBIG) is exploring options to settle its maturing bond principal of IDR5.16 tn this year. According to TBIG’s CFO, Helmy Yusman Santoso, most of the payment will be financed using internal funds, with a smaller portion covered by issuing new debt securities or securing bank loans, benefiting from lower borrowing costs due to recent interest rate cuts by Bank Indonesia. TBIG has four bond series maturing in 2025, with the largest, the Sustainable Bonds VI Phase III Year 2024 (IDR2.7 trillion), due on February 16. This will be followed by the maturity of the Sustainable Bonds VI Phase IV Year 2024 Series A (IDR1.24 tn) on December 13. Additionally, Fitch Ratings Indonesia has assigned TBIG’s proposed IDR 2.8 tn bond issuance a National Long-Term Rating of 'AA+(idn)' as part of its IDR20 tn bond program. The bonds, which represent TBIG's senior unsecured obligations, are rated at the same level as the company’s National Long-Term Rating and will be used to refinance existing debt. (Source : Bisnis Indonesia & Fitch Ratings Indonesia) Comment : We believe TBIG's funding strategy effectively balances favorable borrowing conditions with the mitigation of refinancing risks. Its success relies on generating adequate operational cash flow, navigating market conditions, and maintaining strong cost management. The company has shown prudence in managing its balance sheet during ISAT's network integration, maintaining leverage below target despite increased contract churn from ISAT. The 'AA' National Ratings reflect a very low default risk relative to other issuers in the same country or monetary union, with risk slightly higher than that of the highest-rated issuers.