PT Pemeringkat Efek Indonesia (Pefindo) has granted an idA+ rating with a stable outlook to PT Bumi Resources Tbk (BUMI), acknowledging its strong foothold in Indonesia’s coal mining industry.
Nonetheless, Pefindo highlighted several factors that limit this rating, such as BUMI’s reliance on a single business sector, moderate operational costs, and exposure to fluctuating commodity prices and environmental risks. The agency suggested that improving cost efficiency, increasing profit margins, and expanding into other revenue streams beyond thermal coal could enhance the company’s rating.
Pefindo also warned that a significant drop in revenue or EBITDA could negatively impact BUMI’s financial stability and cash flow. A sharp decline in coal prices would further pose a challenge to maintaining the current rating.
BUMI’s business spans coal and gold mining through its subsidiaries, PT Arutmin Indonesia and PT Bumi Resources Minerals Tbk. It also holds a 51% share in PT Kaltim Prima Coal (KPC), a leading coal producer in Indonesia. As of June 2024, its ownership structure includes Mach Energy (Hong Kong) Limited with 45.78%, HSBC-FUND SVS Chengdong Investment Corp holding 10.68%, Treasure Global Investment Limited at 8.08%, and 35.46% owned by public investors.
Pefindo emphasises that greater cost control and diversification could position BUMI for stronger growth and resilience. However, careful handling of commodity market volatility and environmental issues remains critical to the company’s sustainability.
Image source: Bumi Resources
Source Link:
– https://www.indonesiaminer.com/news/detail/2024-11-12214156-bumi-resources-receives-ida-rating-from-pefindo
– https://www.tvonenews.com/ekonomi/265504-bumi-resources-dapat-rating-ida-dari-pefindo-ini-tantangan-yang-harus-ditangani-perusahaan
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