S&P Global Ratings has given an A- long-term issuer credit rating, among others, to Kuaishou Technology (HKG:1024), according to a Wednesday release.
The company's status as China's second-biggest short-form online video platform due to a large user base amid its unique content as well as continued revenue growth through advertisements and an expanding e-commerce business, serve as strengths, S&P said.
Rising monetization will aid robust free operating cash flow and a significant net cash position, the rating agency said.
However, direct competition with major internet companies could pressure the company's user base or cash flows, especially if its rivals try to gain market share through increased spending, S&P said.
Notable changes in the company's user base, financial policies, debt-to-EBITDA ratio, or performance gap from the industry leader could prompt future rating actions, the rating agency said.
