Fitch Confirms KEPCO's Credit Rating at BB- with Stable Outlook

Kuwait Projects Company (Holdings) – KIPCO – announced that Fitch Ratings affirmed the company’s long-term issuer default rating at BB-, with a stable outlook. The affirmation was based on KIPCO’s diversified investment portfolio, the stability of dividend distributions received from its investments across various economic cycles, its track record of generating long-term investment returns, and its financial flexibility. Fitch also assigned a BB- credit rating to KIPCO’s updated Euro Medium-Term Note program, consistent with the company’s long-term issuer rating.

The affirmation comes despite difficult regional conditions. Fitch noted that KIPCO’s diversified investment portfolio, which spans multiple sectors in the Middle East and North Africa, along with its flexibility, helped mitigate the impact of regional developments on the valuation of assets and the operational performance of group companies. The agency also highlighted the group’s track record in divestments, its ability to influence the management of its companies, and the support it receives from its major shareholders as key factors in the rating affirmation.

Fitch pointed to the credit strength of KIPCO’s two largest portfolio investments, Bank of Bahrain and Kuwait (Bahrain Bourse-listed) and Saudi Dairy and Foodstuff Companies (Sudac), which together account for 41% of the total value of the investment portfolio’s assets. The agency also noted that many group companies hold leading positions in their respective markets.

Fitch praised KIPCO’s approach to effectively managing its investment portfolio and its ability to reduce debt through strategic divestments. It explained that the sale of Gulf Insurance Group in 2024 and other divestments during 2025 contributed to debt reduction and enhanced liquidity.

The agency also underscored KIPCO’s strong liquidity position, with the group’s cash balance reaching $1.1 billion, sufficient to cover debt maturities through early 2028. Fitch expects the net debt-to-asset ratio to remain below 45% over the next four years, with potential decline toward the targeted level of 40% if asset valuations improve.

Commenting on this, Mustafa Al-Shami, Chief Financial Officer of KIPCO Group, said: “The affirmation of our credit rating amid challenging regional conditions is a clear testament to the resilience of our diversified investment portfolio and the disciplined financial approach underpinning our strategy. Our focus on effective portfolio management, strategic divestments, and prudent debt management has enhanced the group’s liquidity and financial flexibility, enabling us to navigate market volatility and meet our financial obligations. Furthermore, the rating of our updated Euro Medium-Term Note program strengthens our access to global debt markets. We will continue to strengthen our financial position, improve the efficiency of our investment portfolio, and deliver sustainable long-term value to our shareholders.”