NC KAZMUNAYGAS
Fitch Ratings has affirmed
A full list of rating actions is provided below.
The affirmation reflects Fitch's unchanged view of a high probability of state support for SK, given its government-related entity (GRE) status and its role as the state's strategic policy arm in
KEY RATING DRIVERS
Status, Ownership and Control: 'Very Strong'
SK manages a portfolio of strategically important national companies, as stipulated by national legislation. The state, as SK's sole shareholder, controls its strategic decisions, mandates key policies on debt, dividends and investments, and appoints its seven-member board of directors and chief executive officer. SK shares are not permitted to be sold, pledged or seized without the approval of the government. Fitch therefore believes that a SK default would result in its assets and liabilities being unconditionally transferred to the state, or a public entity designated by the state.
Fitch believes that SK's plan to privatise several subsidiaries in the medium term will be limited in scale and will not materially affect its status in
Support
SK benefits from well-established national regulation that is generally supportive of its financial viability. As manager of key state-owned companies in
Additionally, in 4Q23 NFRK purchased SK's shares of
Socio-Political Implications of Default: 'Strong'
Companies under SK's management constitute the core of
SK would be difficult to immediately substitute in a default, due to either the monopolistic nature of goods and services provided by its portfolio companies, or its strategically important development functions on behalf of the state. Fitch therefore views a failure of or disruptions to SK's operations could lead to long-term economic implications and hamper economic development.
Financial Implications of Default: 'Very Strong'
The government does not provide an explicit guarantee on SK's debt, but we view such debt as a moral obligation of the state and therefore as quasi-sovereign liabilities. SK is an important debt-market participant, with its leading portfolio companies being regular issuers on international markets and perceived as quasi-sovereign borrowers. As of end-2022, SK's total debt at group level amounted to
Operating Performance
SK's net income increased to
SK's operating revenue at group level increased to
Derivation Summary
Our assessment of the key rating drivers under our GRE Criteria results in a support score of 45 points out of a maximum of 60, leading to SK's ratings being equalised with the sovereign's IDRs.
Short-Term Ratings
The 'F2' Short-Term IDR of SK represents the higher of two options for its 'BBB' Long-Term IDR. Under Fitch's GRE Rating Criteria, when an issuer's long-term ratings are equalised with a sponsor's (
National Ratings
The '
Debt Ratings
SK's senior unsecured debt ratings are in line with its Long- and Short-Term IDRs.
Liquidity and Debt Structure
SK's 2022 debt amounted to
Issuer Profile
SK is a national strategic holding company of assets contributing to the development of the Kazakh economy. SK has stakes in more than 60 companies in various sectors, including natural resources, railway, transport, energy, infrastructure and postal services.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
A downgrade of
Weaker assessment of support leading to a score below 45 under our GRE Criteria
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
An upgrade of
ESG Considerations
Fitch does not provide ESG relevance scores for SK as its ratings and ESG profile are derived from its parent. ESG relevance scores and commentary for the parent entity -
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