Moody's: Peru's corporate sector to be revitalized

Moody's

09:11 | New York (U.S.), Dec. 19.

Peruvian corporate sector will rejuvenate with roughly 4% growth, Moody's Investors Service has affirmed.

In this sense, private consumption will pick up with a broad recovery in commodity prices following a period of disruptive weather and unexpected political transition.

Likewise, it pointed out consumer sentiment has improved for retailers.

"Private consumption is likely to accelerate to 4.0% in 2019 as the economy recovers, slightly faster than 3.3% average 2014-18 compound annual growth rate," Moody's expressed.

It should be noted consumption has recovered somewhat since floods of early 2017, and lower inflation —following Coastal El Niño-related peak food prices— supports consumers.

Furthermore, acceleration in GDP growth will boost demand for goods, services, and credit.

However, the large change in consumer preferences —from new tax— will still be disruptive in the short run, it projected.

According to the credit rating agency, Alicorp (Baa3 stable) has high profitability despite its small size if compared to global peers. It also holds a leading position in Peru —its largest market.

On the other hand, Inretail Pharma (Ba2 stable) —part of Intercorp Peru Ltd. (Ba2 positive), one of the Inca country's largest companies— has a leading market position at home following Quicorp acquisition. Plus, it owns highly recognized brands, and its products have a fairly steady demand in the pharmacy sector.

Concerning Latin American telecommunications, Moody's has forecasted "Peru and Chile will remain the most competitive markets in 2019."

(END) NDP/DTK/MVB

Published: 12/19/2018

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Moody's: Peru's corporate sector to be revitalized

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