08 October 2002 10:09 [Source: ICIS news]
SINGAPORE (CNI--The Moody's Investors Service has changed the outlook on Tosoh Corp's B1 issuer rating to stable from positive, CNI learned on Tuesday.
The change in outlook reflects Moody's view that intense competition and increasing overcapacity in the Japanese petrochemical producer’s core products such as polyvinyl chloride (PVC) and polyethylene (PE) will impede further improvement in cash flow and financial fundamentals in the intermediate term.
Tosoh has been emphasising a reinforcement of its competitiveness throughout its vinyl chain operations from caustic soda to polyvinyl chloride (PVC), Moody’s noted.
The company is making aggressive efforts to improve cost competitiveness from various angles at its own ethylene complex, it added .
However, the situation in the Japanese PVC and PE markets is acute, with most PVC makers facing ongoing operating losses due to a combination of weak domestic demand and overcapacity, the investors’ service observed.
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