The rating on Philippine Long Distance Telephone Co. (PLDT) reflects the country, macroeconomic, and transfer and convertibility (T&C) risk of the Philippines (foreign currency BB/Stable/B; local currency BB+/Stable/B; axBBB+/axA-2). The rating also reflects the high price competition in the domestic cellular market with slowing subscriber growth. PLDT's strong position in the domestic market, diversified services, integrated network, and solid cash flow measures temper these weaknesses. The acquisition of Digital Telecommunications Philippines Inc. (Digitel) in October 2011 complements PLDT's market position. Our 'BB+' T&C assessment for the Philippines constrains the rating on PLDT. We expect growth in the Philippine cellular market to continue to come from the mass-market segments, particularly from the outskirts of Metro Manila. These segments have lower average...
Companies mentioned in this report are: Philippine Long Distance Telephone Co.
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