Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

High Yield Experts

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

Credit

We view Road King as "Medium Risk" on the LARA scale. The company has increasingly focused on growing and improving its property development business. We view favourably Road King's geographical exposure to the Yangtze River Delta and Pan Bohai Rim regions, as well as the steady cash flow from its toll-road segment. The toll-road business has high margins, and reflects the company's decent relationship with the government. However, Road King has little pricing power, as tolls are regulated to avoid excessive charges. We also negatively note the company's reliance on JV structures for the property and toll-road segments, along with its heavy use of perpetual securities. Moreover, Road King has poor disclosure compared to peers.   Our fundamental Credit Bias is “Negative”, as Road King may not be able to deleverage in the near term, given its need to replenish the small land bank. Positively, the company has a well-spread debt maturity profile, with the next offshore bond (USD 480 mn) due in September 2024. Road King does not have to redeem its perpetuals, given the absence of coupon step-ups. Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral". We believe the Chinese Property sector has moderate exposure to environmental and social risks. The sector is not energy intensive, but may face social issues related to construction safety and ability to meet homebuyers’ requirements. We view governance risks as being more significant, due to the sector’s generally lower transparency and weaker internal controls.

  We view Road King as "Medium Risk" on the LARA scale. The company has increasingly focused on growing and improving its property development business. We view favourably Road King's geographical exposure to the Yangtze River Delta and Pan Bohai Rim regions, as well as the steady cash flow from its toll-road segment. The toll-road business has high margins, and reflects the company's decent relationship with the government.   However, Road King has little pricing power, as tolls are regulated to avoid excessive charges. We also negatively note the company's reliance on JV structures for the property and toll-road segments, along with its heavy use of perpetual securities. Moreover, Road King has poor disclosure compared to peers.     Our fundamental Credit Bias is “Negative”, as Road King may not be able to deleverage in the near term, given its need to replenish the small land bank. Positively, the company has a well-spread debt maturity profile, with the next offshore bond (USD 480 mn) due in September 2024. Road King does not have to redeem its perpetuals, given the absence of coupon step-ups.   Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral". We believe the Chinese Property sector has moderate exposure to environmental and social risks. The sector is not energy intensive, but may face social issues related to construction safety and ability to meet homebuyers’ requirements. We view governance risks as being more significant, due to the sector’s generally lower transparency and weaker internal controls. 

Road King - Tear Sheet - Lucror Analytics

Road King Infrastructure

Road King - Tear Sheet - Lucror Analytics