December 27, 2024 08:00 GMT
EM CEEMEA CREDIT: PDLLN: De Beers elevated diamond stockpile adds to pressure
EM CEEMEA CREDIT
Petra Diamonds (PDLLN; Caa2neg/B-neg/-)
De Beers Group elevated diamond stockpile adds to pressure for PDLLN
- PDLLN 9.75 Mar26 still quotes on an offer cash price @ 79.00 area indicatively, but we have little visibility of where a firm bid could be. In yield terms, the bonds are somewhere in the 30s area leaving little room for manoeuvre.
- We expect further pressure for PDLLN following the latest update by De Beers on their estimated USD2bn worth of diamond stockpile, as reported by the Financial Times. The article cites among other factors behind the large inventories a prolonged weakness in Chinese demand, increase in fungible alternatives and post-pandemic changes in lifestyle.
- Recently, PDLLN credit ratings got downgraded by one-notch to B- and outlook negative by S&P, as reported in our note PDLLN “A downgrade is not enough, pressure stays”.
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