Fitch Assigns BB- Rating with Stable Outlook to Navoiyazot

Tashkent, Uzbekistan (UzDaily.com) — International rating agency Fitch Ratings has assigned a final long-term issuer default rating (IDR) of BB- with a stable outlook to JSC Navoiyazot.

The decision follows confirmation that the company remains state-owned and will not be returned to its former parent company, JSC Uzkimyosanoat. Consequently, Fitch evaluates the company under its Government Related Entities (GRE) criteria.

The rating is one notch below Uzbekistan’s sovereign rating (BB/Stable), its sole shareholder, reflecting the “very high likelihood” of government support. Navoiyazot’s standalone credit profile (SCP) is assessed at b-, reflecting limited business scale, low revenue diversification, need for asset modernization, and high debt levels.

Fitch projects the company’s gross debt-to-EBITDA ratio at around 6x in 2025, averaging 4.5x in 2026–2028. Financial flexibility is weak, and corporate governance is limited.

The state owns 100% of the company, controls strategy, investment plans, and regulates some product prices. About 72% of Navoiyazot’s debt is government-guaranteed, with financing mainly provided by state banks and the Ministry of Economy and Finance. In 2025, the company received US$29 million in state support, with an additional US$130 million expected in 2025–2026.

Navoiyazot is strategically important as the main domestic producer of fertilizers for agriculture and sodium cyanide for mining. Fitch notes that a default could negatively affect access to financing for the state and other state-owned enterprises.

The company is implementing a modernization program worth around US$360 million, primarily funded through non-guaranteed external borrowings, with major projects expected to conclude between 2026–2028 and full effects by 2029.

EBITDA is projected to grow from US$150 million in 2025 to US$190 million in 2026–2028, thanks to higher domestic prices and a shift to cheaper solar electricity, despite a profit decline in 2024 due to falling global fertilizer prices and higher domestic energy tariffs.

High capital expenditures (up to 2.2 trillion soums by 2028) will limit debt reduction pace. Fitch expects EBITDA gross leverage to gradually decline from 6x to 4.5x via debt-to-equity conversion (1.2 trillion soums) and profitability growth.

Compared to other EMEA fertilizer producers, Navoiyazot lags in scale and diversification but maintains dominance in the domestic market and benefits from low energy costs.

By the end of 2024, cash holdings were 31 billion soums with no reserve credit lines. In 2025, the company received a 350 billion soums government loan, and annual debt service over the next two years will reach approximately 2.5 trillion soums.

Fitch ESG factors assign a score of 4 for corporate governance and financial transparency, reflecting board dependence and reporting delays. Other ESG indicators score 3, considered neutral for the credit profile.