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Archives: CreditSights Issuer List
Export-Import Bank of India
- Sector: Financial Services
- Sub Sector: Financial Services
- Region: India
- Indicative Yield-to-Maturity (YTM): 4.92%
- Credit Rating : ( Baa3 / BBB- / BBB- )
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Fundamental View
AS OF 21 Aug 2025The Export-Import Bank of India (EXIMBK) was founded in 1982. Its credit standing is built upon the key role it plays in the promotion of India’s cross border trade and investment development, as India’s official export credit agency.
EXIMBK is 100% owned by the Government of India. Given its crucial policy role, close governmental links and quasi-sovereign status, we view it as inconceivable that the Indian government would fail to provide EXIMBK with support in a timely manner, if needed.
Business Description
AS OF 21 Aug 2025- EXIMBK presently serves as a growth engine for the internationalization efforts of Indian businesses, facilitating the import of technology and export product development, export production, export marketing, pre- and post-shipment, as well as overseas investment.
- As at FY25, EXIMBK's loan portfolio was principally made up of export finance (65%) and term loans to exporters (21%), with the remaining 14% split among the financing of overseas investment, import finance, and export facilitation. 38% come under the policy business/face GOI risk while the remaining 62% are to the commercial business.
- By geography, the bank has a primary exposure of 31% to Africa, 59% to Asia (mainly South Asia), 7% to Europe and the Americas, and the remaining to the rest of the world.
Risk & Catalysts
AS OF 21 Aug 2025As a quasi-sovereign issuer with backstops from the Government of India and the Reserve Bank of India (RBI), it is viewed as a proxy to the sovereign. Any downgrade to India’s sovereign rating will flow through to EXIMBK as well.
EXIMBK’s policy role may require it to, at times, take on exposures that could lead to financial losses. This has led to poor asset quality and high impairment charges similar to the public sector commercial banks during the years leading up to the pandemic.
Capital standing, however, is robust thanks to capital infusions from the Government of India which have been stepped up in recent years – INR 50 bn was injected in FY19, followed by infusions of INR 15 bn and INR 13 bn in FY20 and FY21 respectively. The bank received INR 7.5 bn in FY22 despite capital levels remaining strong during the year. No infusions have been made since FY23 due to the comfortable capital position.
Key Metric
AS OF 21 Aug 2025| INR mn | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Net Interest Margin (Annual) | 1.84% | 2.19% | 2.29% | 2.06% | 1.83% |
| ROAA | 0.19% | 0.54% | 1.04% | 1.43% | 1.58% |
| ROAE | 1.49% | 3.97% | 7.76% | 11.47% | 13.16% |
| Equity/Assets | 13.23% | 14.12% | 12.87% | 12.06% | 11.95% |
| Tier 1 Capital Ratio | 24.0% | 28.6% | 23.7% | 19.6% | 23.9% |
| Gross NPA Ratio | 6.69% | 3.56% | 4.09% | 1.94% | 1.71% |
| Provisions/Loans | 2.46% | 0.90% | 1.24% | 0.29% | (0.32%) |
| Pre-Impairment Operating Profit / Average Assets | 2.13% | 2.31% | 2.41% | 2.12% | 1.83% |
CreditSight View Comment
AS OF 06 Jan 2025Exim Bank of India is the country’s key policy bank with full government support. It provides financial assistance to exporters and importers with a view to promote trade in India. It is 100% owned by the Government of India (GoI) and is a proxy to the India sovereign in international debt markets (quasi-sovereign status). The bank cannot be liquidated without the government’s approval and has a track record of government capital infusions. The bank’s asset quality is back on track after some wobbles in previous years. Capital levels are strong. We maintain a Market perform recommendation on the bank.
Recommendation Reviewed: January 06, 2025
Recommendation Changed: January 04, 2021
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Search topics about wealth insights and investments.Baidu
- Sector: Media and TelecommunicationsTechnology
- Sub Sector: Technology
- Country: China
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Fundamental View
AS OF 21 Aug 2025We lowered our recommendation on Baidu to Underperform from Market perform post its weak 2Q25 results; revenues contracted and EBITDA margin fell sharply due to low advertising monetization rate; free operating cash flow was negative for a second consecutive quarter, and net cash narrowed; we expect Baidu’s credit outlook to further weaken over the next 12 months and we see reduced rating headroom at Moody’s as we expect gross leverage to trend higher in 2H25 to 2.8x. We view its bonds as rich compared to A-rated China tech and Asia corporate peers; for example, Baidu trades only 3-5 bp tighter than Alibaba and Tencent, and it is 11/6 bp tighter than Asia A- and A rated corporates; as a gauge, the average spread differential is 23 bp for A3 and A1 rated Asian $ bonds.
Business Description
AS OF 21 Aug 2025- Founded in 2000, Baidu started out as a search engine business and began its development into artificial intelligent (AI) since 2010.
- Baidu Core is the main revenue driver of the company (80% of 2Q25 revenues) which provides search-based, feed-based and other online marketing services (total: 50% of revenues), as well as products and services from new AI initiatives (31% of revenues); Baidu's AI initiatives include AI cloud (enterprise & public sector cloud, and personal cloud), Intelligent Group Driving (Apollo Go, Apollo auto solutions, and intelligent EVs under Jidu Auto), Mobile Ecosystem (Baidu App, ERNIE Bot, Haokan and Baidu Post), and other growth initiatives (ie. Xiaodu smart devices powered by DuerOS smart assistant and AI chips).
- iQiyi accounts for the remaining revenues of Baidu; iQIYI is an online video platform with a content library that includes licensed movies, television series, cartoons, and other programs.
- Baidu launched ERNIE bot in Mar-23, a generative AI chatbot powered by ERNIE, Baidu's in-house foundation model.
- Baidu has a market capitalization of RMB 238.4 bn as of 21 August 2025.
Risk & Catalysts
AS OF 21 Aug 2025Any regulatory clampdowns abroad and domestically (e.g. potential US investment ban, antitrust rules, data security and personal information protection laws) may adversely affect the business of Baidu. The interpretation of Chinese laws and regulations involves some degree of uncertainty.
There are regulatory risks given the corporate structure which uses variable interest entities (VIEs) to circumvent China’s restrictions on foreign ownership of Internet Content Providers (ICPs).
Baidu has made significant investments into long-term AI-related projects, which may take time to turn profitable. A potential escalation of the US chip restriction could have a material negative impact its AI related business (ie. cloud, ernie bot, autonomous driving).
Key Metric
AS OF 21 Aug 2025| RMB bn | FY21 | FY22 | FY23 | FY24 | LTM 2Q25 |
|---|---|---|---|---|---|
| Debt to Book Cap | 29.7% | 28.5% | 25.0% | 22.5% | 24.4% |
| Debt/Total Equity | 42.2% | 39.8% | 33.4% | 29.0% | 32.2% |
| Debt/Total Assets | 24.1% | 23.4% | 20.8% | 18.5% | 20.4% |
| Gross Leverage | 3.3x | 2.8x | 2.2x | 2.0x | 2.5x |
| Interest Coverage | 8.2x | 11.4x | 12.1x | 13.8x | 12.8x |
| EBITDA Margin | 22.6% | 26.8% | 29.2% | 29.3% | 27.2% |
CreditSight View Comment
AS OF 08 Sep 2025We lower our recommendation on Baidu to Underperform from Market perform post its weak 2Q25 results; revenues contracted and EBITDA margin fell sharply due to low advertising monetization rate; free operating cash flow was negative for a second consecutive quarter, and net cash narrowed; we expect Baidu’s credit outlook to further weaken over the next 12 months and we see reduced rating headroom at Moody’s as we expect gross leverage to trend higher in 2H25 to 2.8x. We view its bonds as rich compared to A-rated China tech and Asia corporate peers; for example, Baidu trades only 2-7 bp tighter than Alibaba and Tencent, and it is 11/5 bp tighter than Asia A- and A rated corporates; as a gauge, the average spread differential is 24 bp for A3 and A1 rated Asian $ bonds.
Recommendation Reviewed: September 08, 2025
Recommendation Changed: August 21, 2025
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Fundamental View
AS OF 20 Aug 2025While management has not yet provided consolidated operating profit guidance for FY25, it lowered its FY25 tariff impact estimate by one-third and pointed to “green shoots” in retail vehicle sales trends in North America and China. At the same time, management’s formal retail vehicle sales guidance implies a 1% YoY decline for the balance of the year – not what we would call a bullish outlook. Management is making progress on its manufacturing plant reduction, having announced five of the seven planned plant closures, although it will take time to wind down production and relocate it to other plants. Overall, we remain hopeful but not optimistic regarding management’s Re: Nissan turnaround plan and view the cadence of its monthly retail sales as the best indicator of the plan’s progress.
Business Description
AS OF 20 Aug 2025- Nissan, with headquarters in Yokohama, Japan, is a leading global automotive manufacturer with a market presence in many countries around the globe. The company’s growth investments are focused primarily on Japan, North America, and China, core markets with large profit pools in which Nissan has a meaningful market share. The company’s business in China is conducted through a joint venture with Dongfeng Motor Corporation.
- Nissan’s Sales Financing segment supports the sale of its vehicles by providing financing solutions to its customers and dealers. To enhance their creditworthiness, Nissan maintains keepwell (support) agreements with its wholly owned financial subsidiaries including Nissan Motor Acceptance Corporation (NMAC) in the United States and Nissan Financial Services (NFS) in Japan.
- The Renault-Nissan-Mitsubishi Alliance was established in 1999 to enhance member company scale in product development and raw material purchasing. The alliance includes equity participation, which led to Nissan holding ownership stakes in Renault (15% non-voting) and Mitsubishi (34%) and Renault holding an ownership stake in Nissan (43%). The Alliance’s automobile production volume is the third largest globally behind Toyota and Volkswagen.
Risk & Catalysts
AS OF 20 Aug 2025Management reaffirmed its FY25 guidance for global automotive production, global automotive retail sales, and revenue. However, full-year guidance for operating profit, net income, and automotive free cash flow is still “to be determined” owing to uncertainty related to the potential impact of tariffs and additional restructuring costs that are currently being assessed.
Management expects automotive free cash flow to improve from ¥(390) bn in F1Q25 to ¥(350) bn in F2Q25, including the estimated tariff impact, before turning positive in 2H25. The combined automotive free cash flow of ¥(740) bn in 1H25 – roughly US$4.9 bn – currently represents our worst-case scenario for FY25 automotive free cash flow, assuming the company is automotive free cash flow breakeven in the back half of the year. FY25 automotive free cash flow upside can be achieved if the company generates positive free cash flow in 2H25 as management expects based on its seasonal patterns of working capital usage and cash generation.
Key Metric
AS OF 20 Aug 2025| JPY bn | FY21 | FY22 | FY23 | FY24 | LTM F1Q25 |
|---|---|---|---|---|---|
| Revenue | 7,393 | 9,573 | 11,524 | 11,371 | 11,083 |
| EBIT | (78) | 218 | 394 | (78) | (256) |
| EBIT Margin | (1%) | 2% | 3% | (1%) | (8%) |
| EBITDA | 211 | 535 | 745 | 286 | 77 |
| EBITDA Margin | 2.9% | 5.6% | 6.5% | 2.5% | (5.2%) |
| Total Liquidity | 3,601 | 3,658 | 4,196 | 4,272 | 2,670 |
| Net Debt | (728) | (1,213) | (1,546) | (1,498) | (1,134) |
| Total Debt | 973 | 687 | 468 | 661 | 936 |
| Gross Leverage | n/m | 1.3x | 0.6x | 2.3x | 12.1x |
| Net Leverage | -3.4x | -2.3x | -2.1x | -5.2x | -14.7x |
CreditSight View Comment
AS OF 21 Oct 2025We maintain a Market perform recommendation on Nissan Motor and Nissan Motor Acceptance Co. (NMAC) notes based on the company’s weak near-term outlook for automotive profit and free cash flow that is made harder by tariffs, its turnaround initiatives that target positive profit and free cash flow by FY26, new vehicle launches that target improving retail sales momentum, recent refinancing activity of FY25 debt maturities that also bolstered its liquidity, and relative value.
Recommendation Reviewed: October 21, 2025
Recommendation Changed: July 16, 2025
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Fundamental View
AS OF 20 Aug 2025While we expect its automotive profit margin to fall below the Moody’s EBIT margin downgrade trigger of below 10%, we believe Moody’s is unlikely to make a negative outlook revision in the near term considering it revised its outlook on Toyota from positive to stable in early June after the tariffs had been implemented. Outside the tariff impacts, Toyota’s global sales and market share remain strong, and it maintains a leadership position–if not THE leadership position–in hybrid vehicle sales, which is currently the fastest growing light vehicle segment globally. And while management maintains the long-term strategy of localizing vehicle production in the US, it also announced a new manufacturing facility in Japan that is expected to open by the early 2030s to support its home market.
Business Description
AS OF 20 Aug 2025- Toyota Motor Corp. (TMC) engages in the manufacture and sale of motor vehicles and parts. It operates through the following segments: Automotive, Financial Services, and All Other. The Automotive segment designs, manufactures, assembles and sells passenger cars, minivans, trucks, and related vehicle parts and accessories. Toyota is also involved in the development of intelligent transport systems. The Financial Services segment offers purchase or lease financing to Toyota vehicle dealers and customers. It also provides retail leasing through lease contracts purchased by dealers. The company was founded by Kiichiro Toyoda on August 28, 1937, and is headquartered in Toyota, Japan.
- Toyota Financial Services Corporation (TFSC), a wholly owned subsidiary of TMC, oversees the management of Toyota's finance companies worldwide. Toyota Motor Credit Corporation (TMCC) is the company’s principal financial services subsidiary in the United States. Under terms of the credit support agreement between TFSC and TMCC, TFSC agrees to: (1) maintain 100% ownership of TMCC; (2) cause TMCC and its subsidiaries to have a tangible net worth of at least $100,000; (3) make sufficient funds available to TMCC so that it will be able to service the obligations arising out of its own bonds, debentures, notes and other investment securities and commercial paper. The terms of the credit support agreement between TMC and TFSC are very similar to the terms of the TFSC and TMCC credit support agreement.
Risk & Catalysts
AS OF 20 Aug 2025Toyota revised its FY26 financial guidance that maintains projections for vehicle wholesales (+5%) and revenue (+1%). The guidance reflects a full-year tariff impact of ¥1.4 tn, a ¥725 bn headwind from yen appreciation, and a ¥300 bn drag from higher material costs. These pressures are projected to be partially offset by planned improvement efforts totaling ¥900 bn, comprised of volume/mix gains, cost reductions, value chain profit expansion, and other positive drivers. The company’s consolidated operating margin is now expected to decline from 10.0% in FY25 to 6.6% in FY26, representing 340 bp of contraction, 290 bp of which is from tariffs.
The tariff impact assumptions include a 25% tariff on Japanese exports to the U.S. from April through July, shifting to 12.5% for the remainder of the fiscal year, and a 25% tariff on exports from Canada and Mexico for the entire period. Management highlighted that a portion of these costs are expected to be absorbed by suppliers or mitigated by exemptions for USMCA-compliant parts and U.S.-produced vehicles, but acknowledged “the impact of U.S. tariffs and other factors drove the profit guidance cut.”
Key Metric
AS OF 20 Aug 2025| JPY bn | FY22 | FY23 | FY24 | FY25 | LTM F1Q26 |
|---|---|---|---|---|---|
| Automotive Revenue | 28,606 | 33,777 | 41,081 | 42,996 | 43,276 |
| EBIT | 2,519 | 2,486 | 4,890 | 4,047 | 3,849 |
| EBIT Margin | 8.0% | 6.7% | 10.8% | 8.4% | 7.6% |
| EBITDA | 3,526 | 3,671 | 6,159 | 5,408 | 5,185 |
| EBITDA Margin | 11.2% | 9.9% | 13.7% | 11.3% | 10.3% |
| Total Liquidity | 15,864 | 10,090 | 12,401 | 11,595 | 11,595 |
| Net Debt | (1,719) | (2,825) | (4,025) | (3,355) | (3,355) |
| Total Debt | 2,580 | 2,724 | 2,868 | 2,736 | 2,736 |
| Gross Leverage | 0.7x | 0.7x | 0.5x | 0.5x | 0.5x |
| Net Leverage | -0.5x | -0.8x | -0.7x | -0.6x | -0.6x |
CreditSight View Comment
AS OF 21 Oct 2025We reiterate our Underperform recommendation on notes of Toyota Motor Co. and Toyota Motor Credit Corporation based primarily on relative value, although we consider the Toyota bond complex to be a relatively safe haven for long-term investors.
Recommendation Reviewed: October 21, 2025
Recommendation Changed: May 09, 2025
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Fundamental View
AS OF 20 Aug 2025While we expect its automotive profit margin to fall below the Moody’s EBIT margin downgrade trigger of below 10%, we believe Moody’s is unlikely to make a negative outlook revision in the near term considering it revised its outlook on Toyota from positive to stable in early June after the tariffs had been implemented. Outside the tariff impacts, Toyota’s global sales and market share remain strong, and it maintains a leadership position–if not THE leadership position–in hybrid vehicle sales, which is currently the fastest growing light vehicle segment globally. And while management maintains the long-term strategy of localizing vehicle production in the US, it also announced a new manufacturing facility in Japan that is expected to open by the early 2030s to support its home market.
Business Description
AS OF 20 Aug 2025- Toyota Motor Corp. (TMC) engages in the manufacture and sale of motor vehicles and parts. It operates through the following segments: Automotive, Financial Services, and All Other. The Automotive segment designs, manufactures, assembles and sells passenger cars, minivans, trucks, and related vehicle parts and accessories. Toyota is also involved in the development of intelligent transport systems. The Financial Services segment offers purchase or lease financing to Toyota vehicle dealers and customers. It also provides retail leasing through lease contracts purchased by dealers. The company was founded by Kiichiro Toyoda on August 28, 1937, and is headquartered in Toyota, Japan.
- Toyota Financial Services Corporation (TFSC), a wholly owned subsidiary of TMC, oversees the management of Toyota's finance companies worldwide. Toyota Motor Credit Corporation (TMCC) is the company’s principal financial services subsidiary in the United States. Under terms of the credit support agreement between TFSC and TMCC, TFSC agrees to: (1) maintain 100% ownership of TMCC; (2) cause TMCC and its subsidiaries to have a tangible net worth of at least $100,000; (3) make sufficient funds available to TMCC so that it will be able to service the obligations arising out of its own bonds, debentures, notes and other investment securities and commercial paper. The terms of the credit support agreement between TMC and TFSC are very similar to the terms of the TFSC and TMCC credit support agreement.
Risk & Catalysts
AS OF 20 Aug 2025Toyota revised its FY26 financial guidance that maintains projections for vehicle wholesales (+5%) and revenue (+1%). The guidance reflects a full-year tariff impact of ¥1.4 tn, a ¥725 bn headwind from yen appreciation, and a ¥300 bn drag from higher material costs. These pressures are projected to be partially offset by planned improvement efforts totaling ¥900 bn, comprised of volume/mix gains, cost reductions, value chain profit expansion, and other positive drivers. The company’s consolidated operating margin is now expected to decline from 10.0% in FY25 to 6.6% in FY26, representing 340 bp of contraction, 290 bp of which is from tariffs.
The tariff impact assumptions include a 25% tariff on Japanese exports to the U.S. from April through July, shifting to 12.5% for the remainder of the fiscal year, and a 25% tariff on exports from Canada and Mexico for the entire period. Management highlighted that a portion of these costs are expected to be absorbed by suppliers or mitigated by exemptions for USMCA-compliant parts and U.S.-produced vehicles, but acknowledged “the impact of U.S. tariffs and other factors drove the profit guidance cut.”
Key Metric
AS OF 20 Aug 2025| $ mn | FY22 | FY23 | FY24 | FY25 | F1Q26 |
|---|---|---|---|---|---|
| Total Company Earning Assets | 117,659 | 120,018 | 129,707 | 132,385 | 130,960 |
| Cash and Investments | 7,670 | 6,398 | 8,570 | 10,769 | 9,128 |
| Total Liquidity | 36,070 | 33,498 | 37,570 | 37,569 | 37,128 |
| Unsecured Debt | 82,288 | 78,949 | 88,083 | 90,028 | 85,245 |
| Secured Debt | 26,864 | 32,736 | 34,337 | 37,717 | 37,913 |
| Total Debt | 109,152 | 111,685 | 122,420 | 127,745 | 123,158 |
| Allowance % Retail Rece. | 1.66% | 1.83% | 1.81% | 1.81% | 1.73% |
| Allowance / Net Charge-offs | 6.68x | 3.03x | 2.32x | 2.06x | 2.03x |
| Net Charge-offs % Avg. Receivable | 0.26% | 0.63% | 0.82% | 0.88% | 0.84% |
| 30+ Day Delinquency Rate | 1.8% | 2.3% | 2.6% | 2.5% | 2.4% |
CreditSight View Comment
AS OF 14 Oct 2025We reiterate our Underperform recommendation on notes of Toyota Motor Co. and Toyota Motor Credit Corporation based primarily on relative value, although we consider the Toyota bond complex to be a relatively safe haven for long-term investors.
Recommendation Reviewed: October 14, 2025
Recommendation Changed: May 09, 2025
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Fundamental View
AS OF 20 Aug 2025F1Q26 Non-Financial Services results reflected robust motorcycle sales and record segment profitability, offset by a sharp downturn in automobile earnings due to tariffs, one-time EV-related expenses, and regional sales declines in Asia and Japan. Management is pursuing active mitigation of tariff impacts through localization, production reallocation, and pricing, while maintaining strong cash generation and shareholder returns. Management lowered its projected FY26 tariff cost estimate by nearly one-third, improving its projected FY26 consolidated operating margin compression from 310 bp previously to 230 bp. While the projected FY26 consolidated operating margin of 3.3% remains low, improvement from its previous forecast and lower tariff impact could alleviate negative rating pressure.
Business Description
AS OF 20 Aug 2025- Honda Motor Co., Ltd. engages in the manufacture and sale of automobiles, motorcycles, and power products. It operates through the following segments: Automobile, Motorcycle, Financial Services, and Power Product and Other Businesses. The Automobile segment manufactures and sells automobiles and related accessories. The Motorcycle segment handles all-terrain vehicles, motorcycle business, and related parts. The Financial Services segment provides financial and insurance services. The Power Products and Other Businesses segment offers power products and relevant parts.
- American Honda Finance Corporation (AHFC) is a wholly-owned subsidiary of American Honda Motor Co., Inc. (AHM or the Parent). Honda Canada Finance Inc. (HCFI) is a majority-owned subsidiary of AHFC. Non-controlling interest in HCFI is held by Honda Canada Inc. (HCI), an affiliate of AHFC. AHM is a wholly-owned subsidiary and HCI is an indirect wholly-owned subsidiary of Honda Motor Co., Ltd. (HMC). Honda Motor Co. (HMC) maintains Keep Well (support) agreements with its North American finance subsidiaries, AHFC and HCFI. Under the Keep Well agreements, HMC agrees to (1) maintain at least 80% ownership in AHFC and HCFI, (2) ensure AHFC and HCFI maintain a positive net worth, and (3) ensure both AHFC and HCFI have sufficient liquidity to meet their debt payment obligations.
Risk & Catalysts
AS OF 20 Aug 2025Management maintained its FY26 wholesale unit volume guidance that includes higher motorcycle wholesales and lower wholesales of Automobiles (-3%) and Power Products (-1%). The changes in Motorcycle segment (higher) and Automobile segment (lower) wholesales are expected to be primarily driven by Asia. Automobile wholesales in North America are projected to increase 2% YoY and account for 46% of the company’s global wholesales.
Management raised its FY26 consolidated operating profit forecast from ¥500 bn to ¥700 bn. The increase is equivalent to reduction in projected tariff impacts from to ¥650 bn to ¥450 bn. The revised forecast also includes higher currency tailwinds that are expected to be offset by unfavorable sales and price/cost impacts. While the revised forecast is a material improvement from last quarter’s forecast, it still represents a 42% decline from FY25 operating profit of ¥1.3 tn, mostly attributable to the company’s projected to ¥450 bn tariff cost. Finally, the updated forecast calls for Honda’s consolidated operating profit margin to decline by 230 bp from 5.6% in FY25 to 3.3%, an improvement from the 310 bp margin compression it previously expected.
Key Metric
AS OF 20 Aug 2025| JPY bn | FY22 | FY23 | FY24 | FY25 | LTM F1Q26 |
|---|---|---|---|---|---|
| Revenue | 11,967 | 14,167 | 17,434 | 18,509 | 18,550 |
| EBIT | 741 | 612 | 1,219 | 899 | 661 |
| EBIT Margin | 6.2% | 4.3% | 7.0% | 4.9% | 3.6% |
| EBITDA | 1,334 | 1,294 | 1,964 | 1,630 | 1,383 |
| EBITDA Margin | 11.1% | 9.1% | 11.3% | 8.8% | 7.4% |
| Total Liquidity | 4,612 | 4,926 | 6,150 | 5,368 | 5,044 |
| Net Debt | (2,481) | (2,751) | (3,762) | (3,216) | (2,908) |
| Total Debt | 837 | 803 | 863 | 646 | 630 |
| Gross Leverage | 0.6x | 0.6x | 0.4x | 0.4x | 0.5x |
| Net Leverage | -1.9x | -2.1x | -1.9x | -2.0x | -2.1x |
CreditSight View Comment
AS OF 21 Oct 2025We reiterate our Underperform recommendation on Honda Motor Co. and American Honda Finance Corporation notes based on relative value and its weak but improving consolidated operating profit outlook.
Recommendation Reviewed: October 21, 2025
Recommendation Changed: May 15, 2025
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Fundamental View
AS OF 20 Aug 2025F1Q26 Non-Financial Services results reflected robust motorcycle sales and record segment profitability, offset by a sharp downturn in automobile earnings due to tariffs, one-time EV-related expenses, and regional sales declines in Asia and Japan. Management is pursuing active mitigation of tariff impacts through localization, production reallocation, and pricing, while maintaining strong cash generation and shareholder returns. Management lowered its projected FY26 tariff cost estimate by nearly one-third, improving its projected FY26 consolidated operating margin compression from 310 bp previously to 230 bp. While the projected FY26 consolidated operating margin of 3.3% remains low, improvement from its previous forecast and lower tariff impact could alleviate negative rating pressure.
Business Description
AS OF 20 Aug 2025- Honda Motor Co., Ltd. engages in the manufacture and sale of automobiles, motorcycles, and power products. It operates through the following segments: Automobile, Motorcycle, Financial Services, and Power Product and Other Businesses. The Automobile segment manufactures and sells automobiles and related accessories. The Motorcycle segment handles all-terrain vehicles, motorcycle business, and related parts. The Financial Services segment provides financial and insurance services.
- American Honda Finance Corporation (AHFC) is a wholly-owned subsidiary of American Honda Motor Co., Inc. (AHM or the Parent). Honda Canada Finance Inc. (HCFI) is a majority-owned subsidiary of AHFC. Non-controlling interest in HCFI is held by Honda Canada Inc. (HCI), an affiliate of AHFC. AHM is a wholly-owned subsidiary and HCI is an indirect wholly-owned subsidiary of Honda Motor Co., Ltd. (HMC). Honda Motor Co. (HMC) maintains Keep Well (support) agreements with its North American finance subsidiaries, AHFC and HCFI. Under the Keep Well agreements, HMC agrees to (1) maintain at least 80% ownership in AHFC and HCFI, (2) ensure AHFC and HCFI maintain a positive net worth, and (3) ensure both AHFC and HCFI have sufficient liquidity to meet their debt payment obligations.
Risk & Catalysts
AS OF 20 Aug 2025Management maintained its FY26 wholesale unit volume guidance that includes higher motorcycle wholesales and lower wholesales of Automobiles (-3%) and Power Products (-1%). The changes in Motorcycle segment (higher) and Automobile segment (lower) wholesales are expected to be primarily driven by Asia. Automobile wholesales in North America are projected to increase 2% YoY and account for 46% of the company’s global wholesales.
Management raised its FY26 consolidated operating profit forecast from ¥500 bn to ¥700 bn. The increase is equivalent to reduction in projected tariff impacts from to ¥650 bn to ¥450 bn. The revised forecast also includes higher currency tailwinds that are expected to be offset by unfavorable sales and price/cost impacts. While the revised forecast is a material improvement from last quarter’s forecast, it still represents a 42% decline from FY25 operating profit of ¥1.3 tn, mostly attributable to the company’s projected to ¥450 bn tariff cost. Finally, the updated forecast calls for Honda’s consolidated operating profit margin to decline by 230 bp from 5.6% in FY25 to 3.3%, an improvement from the 310 bp margin compression it previously expected.
Key Metric
AS OF 20 Aug 2025| $ mn | FY22 | FY23 | FY24 | FY25 | F1Q26 |
|---|---|---|---|---|---|
| Total Company Earning Assets | 71,105 | 65,363 | 74,626 | 83,112 | 86,066 |
| Cash and Investments | 2,607 | 1,544 | 1,670 | 4,052 | 2,728 |
| Excess Liquidity | 9,607 | 8,544 | 8,670 | 11,052 | 9,728 |
| Unsecured Debt | 38,026 | 33,410 | 41,566 | 48,363 | 50,725 |
| Secured Debt | 8,888 | 6,927 | 9,351 | 12,384 | 12,700 |
| Total Debt | 46,914 | 40,337 | 50,917 | 60,747 | 63,425 |
| Allowance % Retail Rece. | 0.58% | 0.71% | 0.80% | 0.80% | 0.86% |
| Allowance / Net Charge-offs | 3.75x | 2.41x | 1.72x | 1.48x | 1.45x |
| Net Charge-offs % Avg. Receivable | 0.15% | 0.29% | 0.52% | 0.57% | 0.60% |
| 30+ Day Delinquency Rate | 1.1% | 1.2% | 1.2% | 1.4% | 1.5% |
CreditSight View Comment
AS OF 14 Oct 2025We reiterate our Underperform recommendation on Honda Motor Co. and American Honda Finance Corporation notes based on relative value and its weak but improving consolidated operating profit outlook.
Recommendation Reviewed: October 14, 2025
Recommendation Changed: May 15, 2025
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Search topics about wealth insights and investments.PLDT
- Sector: Media and TelecommunicationsTechnologyTechnology Media and Telecommunications
- Sub Sector: Telecommunications
- Country: Philippines
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Fundamental View
AS OF 20 Aug 2025PLDT’s FY24 and 1H25 results were stable as expected; we see a modestly improving FY25 credit outlook aided by resilient EBITDA growth and residual tower sales, which could offset persisting high capex.
A potential stake sale of the data center business could drive further deleveraging.
While the spillover of a PHP 33 bn capex overrun to FY25 could weigh on free cash flows, we draw mild comfort that it was likely not due to fraud but rather a management misstep.
Business Description
AS OF 20 Aug 2025- PLDT is a leading telecom operator in the Philippines, competing alongside its main rival Globe Telecom in a predominant duopoly.
- PLDT provides 2G/3G/4G mobile, fixed-line, broadband, enterprise data, and other digital services to retail and corporate customers.
- PLDT operates through 2 main business segments – “Wireless Services” and “Fixed Line Services”.
- Its “Wireless” segment offers mobile voice, mobile SMS, mobile data and mobile broadband services to retail customers in the Philippines. These services are marketed under the “Smart Postpaid”, “Smart Prepaid”, "Sun Postpaid" and “TNT Prepaid” brands.
- Its “Fixed Line Services” segment provides fixed line voice, corporate data and home broadband services to retail and corporate customers in the Philippines.
- PLDT commercially launched 5G services on a small-scale basis in Jul-2020. It currently has over 3,000 5G sites nationwide.
- PLDT maintains dominant market shares in the mobile, fixed line voice, and the home broadband spaces.
- PLDT is backed by three established corporate groups, namely First Pacific (~15% stake), NTT Corporation (~12% stake) and JG Summit Holdings (~7% stake).
Risk & Catalysts
AS OF 20 Aug 2025Aggressive expansion by new entrant DITO over the next 2-4 years could chew away at PLDT’s market share and restrain recoveries in average revenues per user (ARPU).
PLDT incurs significant capex that has restrained improvements in its leverage metrics and free cash flows. This is worsened by a recent capex overrun that has induced mild corporate governance uncertainties (though these have eased in recent months).
Consistently high dividend payouts could worsen PLDT’s already negative free cash flows.
PLDT is exposed to $/PHP depreciation risks ($300 mn 2050 bond is fully unhedged).
Key Metric
AS OF 20 Aug 2025| PHP bn | FY22 | FY23 | FY24 | 1H24 | 1H25 |
|---|---|---|---|---|---|
| Debt to Book Cap | 71.9% | 73.3% | 74.2% | 73.4% | 73.5% |
| Net Debt to Book Cap | 65.7% | 69.3% | 72.0% | 70.6% | 71.2% |
| Debt/Total Equity | 256.2% | 273.9% | 287.5% | 275.9% | 277.2% |
| Debt/Total Assets | 46.8% | 49.6% | 53.8% | 50.2% | 55.2% |
| Gross Leverage | 2.9x | 2.9x | 3.0x | 3.0x | 3.1x |
| Net Leverage | 2.7x | 2.8x | 2.9x | 2.9x | 3.0x |
| Interest Coverage | 7.4x | 6.5x | 6.1x | 6.3x | 5.8x |
| EBITDA Margin | 48.7% | 49.1% | 51.1% | 50.6% | 51.5% |
CreditSight View Comment
AS OF 20 Aug 2025We have a Market perform recommendation on PLDT and would avoid its 2050 bond. PLDT 2031 trades fairly to Globe 2030, Axiata 2030, and Bharti 2031. We do not like the PLDT 2050 that trades tight to other 2050 bonds in SSEA, including Reliance, Pertamina, and PLN. We are comfortable with PLDT’s sturdy credit profile aided by a resilient broadband business and tower sales, cushioning high capex and dividends. A minority stake sale of its data center business is also credit positive. Corporate governance fears have also eased post its capex overrun in end-2022. We are watchful of strong competition in the mobile space due to DITO’s ramp up.
Recommendation Reviewed: August 20, 2025
Recommendation Changed: May 31, 2022
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Search topics about wealth insights and investments.International Container Terminal Services Inc
- Sector: Transportation
- Sub Sector: Shipping and Infrastructure
- Country: Philippines
- Bond: ICTPM 3.5 31
- Indicative Yield-to-Maturity (YTM): 4.96%
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Fundamental View
AS OF 20 Aug 2025We expect ICTSI to remain resilient amid global growth slowdown fears owing to yield improvements and strong cost control.
ICTSI has steadily deleveraged over the past 5 years which we see as prudent financial management. Yet management’s recent lean towards growth at the expense of deleveraging could restrain improvements in credit metrics.
While ICTSI is exposed to material EM-related geopolitical risks, we think its geographically diversified revenue base across 20 countries limits country-specific risks.
While sizable capex and high dividend payouts could strain ICTSI’s credit profile, we take comfort in ICTSI’s robust OCF generation that should keep FCFs positive.
Business Description
AS OF 20 Aug 2025- ICTSI develops and operates common user container terminals, with a focus on those within Origin and Destination (O&D) ports based in emerging markets.
- ICTSI provides integrated ports services that facilitate the receiving, handling and storage of cargo. These are broadly split into four streams: vessel charges (i.e. services relating to moving cargo on and off ships), yard charges (i.e. services relating to moving cargo in the container and storage yards), storage fees (i.e. services relating to cargo and container storage), and other ancillary fees.
- ICTSI currently operates across 33 port concessions in 19 countries. As of end-1H25, ICTSI's revenues are well diversified across the Asia (43%), EMEA (19%) and the Americas (38%).
- ICTSI operates its container terminals under long-dated concession agreements (typically ~25 years) with the relevant local port authorities or governments. For some concessions, fees charged to customers are regulated by the authorities that prescribe maximum price limits and, in some cases, allow for CPI-linked tariff hikes. For other concessions, fees charged are unregulated and allow for greater price-setting flexibility and volatility too.
- ICTSI is required to make periodic fee payments to the respective authorities for the right to operate the concessions. These payments are typically a combination of fixed charges and variable charges based on cargo traffic volume or gross revenues.
Risk & Catalysts
AS OF 20 Aug 2025ICTSI is exposed to EM-related geopolitical, regulatory and operating risks. That said, we think the impact is mitigated by its geographically diversified revenue base across 20 countries that limits country-specific risks.
Trade uncertainties from Trump’s policies could hamper cargo volume growth.
Growing capex tendencies and high dividend payouts could strain ICTSI’s free cash flows and credit metrics, though we think the impact is mitigated by ICTSI’s robust operating cash flow generation.
While ICTSI is exposed to FX depreciation risks as most of its revenues and cash expenses are in EM currencies, natural hedging has been fairly effective thus far.
Key Metric
AS OF 20 Aug 2025| $ mn | FY22 | FY23 | FY24 | 1H24 | 1H25 |
|---|---|---|---|---|---|
| Debt to Book Cap | 71.9% | 73.0% | 70.1% | 74.3% | 73.5% |
| Net Debt to Book Cap | 58.2% | 61.0% | 52.6% | 59.4% | 55.2% |
| Debt/Total Equity | 255.3% | 269.9% | 233.9% | 289.2% | 276.8% |
| Debt/Total Assets | 62.5% | 60.3% | 58.2% | 60.7% | 58.2% |
| Gross Leverage | 3.1x | 2.9x | 2.5x | 2.7x | 2.3x |
| Net Leverage | 2.5x | 2.4x | 1.9x | 2.2x | 1.8x |
| Interest Coverage | 4.6x | 4.4x | 4.9x | 4.6x | 5.3x |
| EBITDA Margin | 62.8% | 63.0% | 65.0% | 65.4% | 65.6% |
CreditSight View Comment
AS OF 20 Aug 2025We have a Market perform recommendation on ICTSI. We think ICTSI 2030 and 2031 trades fairly to PLDT 2031 and Globe Telecom 2030. We expect ICTSI’s credit metrics could remain improve slightly in FY25 as steady yield improvements and sturdy domestic trade activity could outweigh high capex, potential M&A, and trade uncertainties from Trump’s policies. While ICTSI is exposed to EM-related geopolitical and operating risks (notably in the Mid East and Russia-Ukraine), we believe these are mitigated by its highly geographically diversified revenues. We also expect ICTSI’s robust cash-generative business to drive positive free cash flows even amid persisting capex and dividends. We see low non-call risk for the ICTSI c.2026 perp
Recommendation Reviewed: August 20, 2025
Recommendation Changed: August 16, 2023
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Search topics about wealth insights and investments.Globe Telecom
- Sector: TechnologyTechnology Media and Telecommunications
- Sub Sector: Telecommunications
- Country: Philippines
- Bond: GLOPM 3 35
- Indicative Yield-to-Maturity (YTM): 4.93%
- Credit Rating : Unrated
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Fundamental View
AS OF 20 Aug 2025- Globe’s 1H25 results were poorer than expected, but we believe credit metrics may improve modestly through 2H25 from modest EBITDA growth, lower YoY capex, and residual tower sales closures.
- While we acknowledge the stiff competitive pressures brought about by new entrant DITO, the impact is mitigated by Globe’s still-dominant mobile market position and DITO’s slowing expansion (given its weak financials and the costly capex involved).
- Weakness in the broadband business has lessened since 3Q24 and could stabilize by end-2025.
- While Globe earlier raised the upper end of its dividend policy, we expect dividend payouts to remain stable.
Business Description
AS OF 20 Aug 2025- Globe is a leading telecom operator in the Philippines, competing alongside its main rival PLDT in a duopoly setting.
- Globe provides 2G/3G/4G mobile, fixed-line, broadband, enterprise data, and other digital services to retail and corporate customers.
- Globe operates through 2 main business segments – “Mobile Services” and “Fixed Line and Home Broadband Services”.
- Its “Mobile Services” segment offers mobile voice, mobile SMS and mobile data services to retail customers in the Philippines. These services are marketed under the “Globe Postpaid”, “Globe Prepaid” and “TM” brands.
- Its “Fixed Line and Home Broadband Services” segment provides fixed line voice, corporate data and home broadband services to retail and corporate customers in the Philippines.
- Globe commercially launched 5G services on a small-scale basis in Jun-2019. It currently maintains 5G coverage of 96% of the National Capital Region, with over 2,000 5G sites nationwide.
- Globe maintains dominant market shares in the mobile data, voice and SMS space (FY22 revenue market share [RMS] of 52% vs PLDT 40%), but loses out to PLDT in the home broadband space (FY22 RMS of 28%-30% vs PLDT 48%-50%).
- Globe is largely owned by two established corporate groups – Ayala Corporation (~47 stake) and Singtel (~43% stake).
Risk & Catalysts
AS OF 20 Aug 2025- Globe faces mounting competitive pressures from new mobile entrant DITO and incumbent broadband competitor PLDT.
- Aggressive expansion by new entrant DITO over the next 2-4 years could chew away at Globe’s market share and restrain recoveries in average revenues per user (ARPU).
- Globe incurs heavy capex that has pressurized its leverage metrics and free cash flows. That said, capex had peaked in FY23 and should meaningfully decline ahead.
- Consistent dividend payouts could weigh on Globe’s free cash flows; Globe recently raised the upper end of its dividend policy from 75% to 90% of net income, suggesting an increased skew to shareholder-friendly actions.
Key Metric
AS OF 20 Aug 2025| PHP bn | FY22 | FY23 | FY24 | 1H24 | 1H25 |
|---|---|---|---|---|---|
| Debt to Book Cap | 67.5% | 69.7% | 70.2% | 69.5% | 69.9% |
| Net Debt to Book Cap | 63.7% | 66.6% | 66.4% | 66.1% | 66.5% |
| Debt/Total Equity | 208.1% | 230.5% | 235.8% | 227.6% | 232.3% |
| Debt/Total Assets | 57.1% | 60.3% | 62.4% | 60.3% | 62.4% |
| Gross Leverage | 3.9x | 4.3x | 4.4x | 4.3x | 4.5x |
| Net Leverage | 3.7x | 4.1x | 4.2x | 4.1x | 4.3x |
| Interest Coverage | 5.9x | 4.6x | 4.3x | 4.4x | 4.1x |
| EBITDA Margin | 46.7% | 47.7% | 49.7% | 49.9% | 50.4% |
CreditSight View Comment
AS OF 20 Aug 2025We have a Market perform recommendation on Globe with a preference for its c.2026 perp. Globe 2030 trades slightly wider to PLDT 2031 that we view as fair. Globe c.2026 perp trades at a juicy 1.4x perp-to-Globe 2030 senior multiple that we view as attractive for short-dated “IG” paper. We anticipate a modestly improving credit outlook as lower capex and residual tower sales closures are offset by a continued weak broadband business and sticky dividends. Stiff competition in both the mobile and broadband spaces is a key concern too. Globe also recently revised its dividend policy to 60%-90% of PAT from 60%-75% previously, suggesting an increased skew towards shareholder-friendly actions, though this has not happened yet.
Recommendation Reviewed: August 20, 2025
Recommendation Changed: June 18, 2024
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