The long-term corporate credit rating of Japan's second largest shipping line, MOL, has been upgraded by international ratings agency, Standard and Poor's (S&P) from "BBB" to "BBB+".

The development follows a similar upgrade by S&P of MOL's competitor, "K" Line, which saw its corporate credit rating and its senior unsecured bond rating improved from "BBB-" to "BBB".

The credit ratings agency said in a MOL statement that the company's credit ratings has been raised because of improvement in cash flow stability resulting from efforts to expand sources of steady income and moves to increase the number of long-term contracts.

S&P also stated that the company's policy of intensively focusing management resources on the shipping business is expected to further strengthen its business franchise with the plan to using new, highly-cost-competitive vessels, which were ordered before rises in ship construction costs.

In addition, the ratings agency said that "given the prospects of solid business performance in the near term, the ratio of net debt to total capitalisation is expected to remain on a stable, improving trend".