Taiwan Ratings Corporation (TRC) has confirmed CHIMEI Corporation’s long-term and short-term issuer credit ratings as “twAA–” and “twA-1+” respectively, with a long-term credit outlook of “stable”.

According to TRC’s 2021 annual report, CHIMEI is currently the largest ABS resin manufacturer in the world, occupying a leadership position in terms of its market penetration, cost structure, and low leverage ratio. In the same report, TRC expects the company to be able to maintain a high net cash balance, despite a potential increase in its capital expenditures for expanding production capacity in the mainland area between 2021 and 2022. TRC also predicts that the economic recovery in China and the U.S. will bolster the demand for—and profit margin of—bulk and commodity chemicals.

Additionally, TRC upgraded CHIMEI’s liquidity rating from “strong” to “exceptional,” stating that CHIMEI’s sources of liquidity should be sufficient to cover its liquidity needs due to the company’s positive and stable relationship with Taiwanese banks and its relatively high creditworthiness in Taiwan’s capital market. This point is further corroborated by the lower-than-average interest rate of the 5-year green bond issued by the company in September 2018.

It is worth mentioning that, in addition to CHIMEI’s operating performance in the past year, TRC officially included environmental, social, and corporate governance (ESG) as a focus of this year’s interview, with evaluation criteria including the company’s ESG investments and expected improvements. For both financial institutions and credit rating agencies alike, this marks a paradigm shift from solely focusing on financial figures, operational outcomes, and cash flows to the holistic evaluation of a company’s sustainable development performance and ability by gauging its investments in ESG. Therefore, a company’s ability to excel in ESG not only influences the way it accepts orders but also plays a significant role in determining its financing needs.