Fitch Ratings affirmed China Overseas Grand Oceans Group's (HKG:0081) long-term foreign-currency issuer default rating at BBB with a stable outlook, according to a Thursday ratings commentary.

The rating action was supported by COGO's solid market position, low leverage and financial flexibility, but constrained by its concentration in mid- to lower-tier cities and smaller scale relative to peers.

COGO's rating is one notch below the standalone credit profile of its controlling shareholder, China Overseas Land & Investment (HKG:0688). Fitch does not expect support from COLI's ultimate parent, state-owned China State Construction Engineering, to flow through to COGO, citing the latter's limited scale and importance to housing objectives.

The ratings agency said China's new home-sales policy was likely to have only a modest impact on COGO and that the company's financial profile would help it navigate the policy transition.

Shares of the property firm fell nearly 6% in recent trade.