Lotte Construction Secures 344 Billion KRW Through Corporate Bond Demand Forecast

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On the 31st, Lotte Construction conducted a demand forecast for the issuance of 20 billion KRW in 1-year corporate bonds, resulting in a total inflow of 34.4 billion KRW. Although supported by a credit guarantee from Lotte Chemical, this is expected to help dispel market concerns about Lotte Construction.

Lotte Construction's credit rating is A+ (negative outlook). However, this corporate bond received an 'AA' (stable) rating through the guarantee of its largest shareholder, Lotte Chemical.

The desired interest rate range was presented as Lotte Chemical's average market rate ±70bp (1bp = 0.01 percentage points), and the issuance was filled at around +60bp.

The issuance date is scheduled for the 7th of next month. The raised funds will be used for debt repayment. A corporate bond worth 16 billion KRW matures in February.

Due to Taeyoung Construction's workout, concerns about construction companies' fund-raising were high until mid-month. However, recently, large construction companies including Lotte Construction have been successfully issuing corporate bonds.

Hyundai Construction (AA-), which issued corporate bonds this month, succeeded in increasing the amount and finalized 30 billion KRW. SK Ecoplant (A-) will also issue 25.6 billion KRW, more than double the initially planned 13 billion KRW.

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