International credit rating agency Fitch Ratings has announced that it has revised the outlook for Russian mining and steelmaking company EVRAZ Group to positive from stable, and has affirmed its credit rating at BB+.
Fitch said that the revision of the outlook reflects EVRAZ’s resilient performance in challenging markets in 2020 and expected improvements to financial metrics through incremental debt reduction and better earnings prospects.
According to the statement, Fitch expects steel prices to moderate later in 2021 and going into 2022 with supply being supported by high capacity utilization of operational plants, and by moderating demand as the order backlog is run down and restocking through the value chain is completed.
Regarding the Russian steel market, the agency expects Russian steel demand to reach pre-pandemic levels in 2021, supported by construction and infrastructure spending that are aided by government stimulus. Real GDP growth in Russia is forecast at around 3.3 percent for 2021 and 2.7 percent for 2022. Fitch stated that over the medium term domestic steel demand will be constrained by lower GDP and industrial production growth as the government stimulus tapers off.