Standard & Poor's Ratings Services' ratings on PDG Realty S.A. Empreendimentos E Participacoes (PDG) incorporate the risks associated with the company's exposure to the highly competitive, cyclical, and fragmented Brazilian homebuilding sector, which depends on economic conditions, and the risks of credit availability to home buyers and homebuilders. The long production cycle in the homebuilding sector, which demands high levels of working capital, and its aggressive growth strategy, which is based on acquisitions and housing starts, also temper the ratings. The company's diversification-- both in terms of geography and income segment, its adequate liquidity, and its sizable landbank, which reduces the pressure for land acquisitions, partially offset these risks. PDG's business profile is fair. The fundamentals of the homebuilding industry...
Companies mentioned in this report are: PDG Realty S.A. Empreendimentos E Participacoes
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