Sep 16, 2013 - Fitch Ratings affirmed at A(bra) the long-term credit rating on national scale of Brazilian renewable energy developer Renova Energia (SAO:RNEW3).
The agency assigned the same rating on Renova's second debenture issue, worth BRL 300 million (USD 131.6m/EUR 98.5m) of notes maturing in 2022.
The outlook on the corporate rating is "stable".
The ratings mirror the strong operating assets of the company and its energy projects under development. According to the agency, Renova's projects are seen to provide important cash flow to the company. The existence of long-term contracts for the sale of energy is considered positive as it ensures greater predictability of Renova's results. Fitch also took into account that 77% of Renova's contracted capacity, of 1,449 MW, is still under development at present, which adds greater risks to the projects in the pre-operating period.
The direct participation of local power player Light (SAO:LIGT3) and the indirect of sector firm Cemig (SAO:CMIG4) in Renova's controlling bloc is evaluated as positive by the agency as it gives Renova higher financial flexibility.