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Photo = Yonhap news |
[Alpha Biz= Paul Lee] Seoul, July 13, 2025 — According to Korea Ratings Corporation (Korea Ratings), a total of 56 companies saw changes to their long-term and short-term credit ratings or outlooks during the agency’s regular evaluations in the first half of 2025. Of these, 24 were upgraded, while 32 were downgraded, resulting in an upgrade-to-downgrade ratio of 0.75. Korea Ratings currently maintains effective credit ratings for approximately 450 publicly rated non-financial and financial entities.
In comparison, the full-year ratio for 2024 was 0.57 (25 upgrades vs. 44 downgrades). Korea Ratings explained that the ratio had exceeded 1.0 during 2021–2022 amid strong earnings and capital improvements, but dropped sharply in 2023–2024 due to deteriorating results in the petrochemical, construction, and non-bank financial sectors, as well as sluggish domestic demand.
“While credit downgrades continued to outpace upgrades in the first half of 2025, the magnitude of downward revisions has moderated somewhat,” the agency stated.
Downgraded Sectors: Petrochemicals, Construction, Gaming, and Financials
Key sectors that saw ratings downgrades included petrochemicals, construction, cinema chains, gaming, retail, cement, paper, and pharmaceuticals.
In the petrochemical sector, companies such as Lotte Chemical, SKC, SK Advanced, HD Hyundai Chemical, and Hyosung Chemical were downgraded due to weakened profitability and increased financial leverage.
In construction, firms like Lotte E&C and BS Hanyang faced downgrades amid a real estate downturn.
In consumer and content-driven sectors, declining demand trends led to downgrades of NCSoft, ContentreeJoongAng, and Homeplus.
As a result of the downgrade of Lotte Chemical, the integrated credit rating for Lotte Group was lowered, affecting Lotte Corporation, Lotte Property & Development, Lotte Capital, and Lotte Rental.
In the financial sector, companies such as Hyundai Marine & Fire Insurance, KDB Life Insurance, and Lotte Insurance (outlook revision) were downgraded due to deteriorating capital adequacy and profitability.
IBK Savings Bank and JT Chinae Savings Bank were downgraded due to asset quality and earnings pressures.
Real estate project finance (PF) concerns led to downgrades for real estate trust firms like Kyobo Real Estate Trust and Korea Investment Real Estate Trust.
SK Specialty saw a downgrade due to weakened expectations of group support following a change in controlling shareholder, while Ssangyong C&E was affected by increased shareholder return obligations.
Upgraded Sectors: Defense, Power Equipment, Shipbuilding, and Biotech
Conversely, credit upgrades were driven by improved operating performance, M&A activity, capital strengthening, and business expansion.
Companies with upgraded ratings included LS ELECTRIC, HD Hyundai Electric, Hyundai Corporation (power equipment), and Hanwha Systems, Hyundai Rotem, and Poongsan (defense).
HD Hyundai Heavy Industries, Korea Line Corp., and Samsung Biologics also received upgrades, as did Josun Hotels & Resorts, Cosmax, and Korean Air (following its acquisition of a competitor).
Newly listed LG CNS received an upgrade based on improved capital capacity.
In the financial sector, upgrades were seen at companies such as Tongyang Life Insurance, ABL Life Insurance, MG Capital, Hanwha Life Insurance, DB Life Insurance, Daishin F&I, Woori F&I, and Woori Investment Bank, reflecting stronger financial backing or new ownership structures.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
