“The rating reflects Digi’s strong market positions in Romania in both the fixed-line and mobile segments, increasing geographic diversification, strong growth prospects and moderate leverage. This is balanced against expected negative free cash flow (FCF) over the next five years due to investments in its international markets, high execution risks in launching operations in Portugal and Belgium, partial ownership of networks in some operations outside Romania, fairly low profitability and manageable foreign exchange (FX) risks,” Fitch said explaining the rating.
The stable outlook reflects Fitch’s expectation that Digi will continue generating sufficiently strong cash flow in Romania to cover international expansion, with EBITDA net leverage remaining within its rating thresholds and trending towards its upgrade sensitivity by end-2028. Access to capital markets and proactive management of its asset base to mitigate refinancing risk are key to maintaining the ‘BB’ rating.
Digi has a RON6.4 billion capitalization and its shareholders included private pension fund NN Pensii. Digi’s shares have gained 45.5% since the beginning of the year on a traded volume of RON202 million, Bucharest Stock Exchange data show.
(English version by Loredana Fratila-Cristescu)