PUTRAJAYA BINA SDN BHD - 2022 |
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| Report ID | 6053890046868 | Popularity | 857 views 85 downloads | |||||
| Report Date | Aug 2022 | Product | ||||||
| Company / Issuer | Putrajaya Bina Sdn Bhd | Sector | Property | |||||
| Price (RM) |
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| Rationale |
Rating action MARC Ratings has affirmed its AAAIS rating on Putrajaya Bina Sdn Bhd’s (PBSB) RM1.58 billion Islamic Medium-Term Notes (Sukuk Wakalah) Programme. The rating outlook is stable. Rationale The affirmed rating is driven by the steady periodic payment streams in the form of availability charges (AC) from its sole obligor, the Malaysian government (AAA/Stable), the quantum of which is sufficient to meet the financial obligations under the Sukuk Wakalah programme. PBSB also benefits from its status as a wholly-owned subsidiary of Putrajaya Holdings Sdn Bhd (PJH, rated AAA/Stable), the master developer of the federal government administrative capital in Putrajaya. PBSB had developed nine blocks of government office buildings and one block of shared facilities in Parcel F, Precinct 1 in Putrajaya under a government concession agreement. The development was completed in April 2019, ahead of its scheduled completion in December 2019. In return for developing the properties, PBSB receives AC payments under a 25-year asset management phase of the concession agreement. The AC payments amount to RM215.6 million p.a. The company also receives maintenance charges (MC) of RM69.2 million p.a. subject to meeting specific key performance indicators (KPIs). As at date, PBSB has received MC payments in full. The quantum of the annual AC payments is sufficient to meet the principal repayments and profit payments under the Sukuk Wakalah Programme while the MC payments provide additional buffer to the covenanted financial service cover ratio (FSCR) of 1.50x. The FSCR would stand at 2.32x as at end-2022 based on the projected cash flow. Rating outlook PBSB’s stable outlook assumes no disruption to the timely and predictable payments from the Malaysian government to meet its financial obligations throughout the tenure of the Sukuk Wakalah Programme. Rating trajectory Downside scenario Rating pressure would arise if there are changes in the timeliness and quantum of the payment stream from the government and if PJH ceases to be a controlling shareholder of PBSB. Strengths • Stable and predictable cash flows from the government • Support from strong creditworthy parent Challenge/Risk • Meeting KPIs to receive management charges |
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