Summary: Shanghai Baosteel Group Sep 02

Standard & Poors, September 2002

Abstract
The rating on Shanghai Baosteel Group (Baosteel) reflects the company's greatly improved capital structure and cash flow protection measures. The improvements are a result of substantial decreases in debt due to the completion of debt-to-equity swaps at the operations of Shanghai Metallurgical and Meishan, two weak steel mills with which the company merged at the government's request in 1998. The rating also reflects Baosteel's strong market position in mainland China's steel industry, as well as its gradual increase in high-value-added products, and competitive cost position. These strengths are offset by the highly competitive and cyclical nature of the steel industry, and the operational and financial risks associated with industry consolidation in mainland China. Baosteel produced about 19 million tonnes of...

Companies mentioned in this report are: Baosteel Group Corp.
Action: Review

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This product consists of a Summary Analysis: Bi-annual (at least). An abbreviated analysis containing Standard & Poor's issuer credit ratings as of the time the article was published. The analysis includes a rating rationale - the basis on which the rating was assigned - and an outlook section if the issuer is not on CreditWatch. Financial statistics are not included.

Baosteel Group Corp.

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