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Alliance Oil Co. Ltd.
Standard & Poors, April 2011
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Full Analysis
Abstract
Diverse activities in Russia, including oil exploration, production, refining, and retail. Adequate profitability. Currently moderate debt levels, medium-term maturity profile, and significant liquidity reserves. Inherent cyclicality of the global oil and gas exploration and production industry. Likelihood of substantial negative free operating cash flows and rising debt in 2010-2011, owing to high capital expenditure. Execution risk related to two big investment projects. Risk of a decrease in downstream profitability if the Russian government approves a new taxation framework currently under development. Country risk. The ratings on Russia-based Alliance Oil Co. Ltd. incorporate Standard & Poor's Ratings Services' assessment of the company's business risk profile as 'weak' and its financial risk profile as 'aggressive'. In our view, Alliance Oil's business risk...
Companies mentioned in this report are: Alliance Oil Co. Ltd.
Action: Review
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