Moody's confirms A1 rating for four Dubai firms

Moody's Investors Service yesterday confirmed "A1" ratings for DP World, Dubai Electricity and Water Authority, Jebel Ali Free Zone and DIFC Investments in a review of six Dubai companies.

Moody's said that the recent provision of federal funds to Dubai in the form of a $10 billion (Dh36bn) bond as part of a $20bn programme has provided greater assurances to the market.

Moody's said the decision to confirm its ratings of the four companies is based on their "highly visible and strategic mandates, which carry significant relevance and importance not only to Dubai, but the wider region."

Accordingly, Moody's believes that all four entities are "central pillars" of the country's economic infrastructure and would therefore continue to benefit from federal support.

The ratings agency also said all four firms demonstrate "fairly resilient fundamental credit profiles" and were thus unlikely to require financial support under current planning assumptions.

"Companies have made material adjustments to their business plans in response to acute market challenges, seeking to conserve cash and minimise refinancing wherever possible," it said.

The ratings agency also revised Dubai Holding Commercial Operations Group rating to A2 from A1, and Emaar Properties to Baa1 from A3. The outlook on all the six companies ratings is negative.