MARC has assigned a rating of AAA_IS with a stable outlook on Putrajaya Holdings Sdn Bhd (PJH)’s proposed RM1.0 billion 20-year Sukuk Wakalah Programme. Concurrently, the rating agency has affirmed its existing ratings on PJH’s other issuances, the list of which is provided at end of this announcement. The ratings outlook is stable.

Proceeds from the new programme will be used for the construction of PJH’s commercial and residential projects in Precincts 7 and 8 in Putrajaya. These projects (excluding projects under planning), which have an estimated gross development cost of RM775.8 million, are slated for completion by end-2025.

MARC continues to premise the ratings and outlook on the predictable and sizeable lease rental income from the Malaysian government as the principal lessee of 41 government buildings in Putrajaya, the construction of which was undertaken and funded by PJH. The annual lease rental income of RM1.6 billion is deemed as more than sufficient to meet principal repayments of between RM470.0 million and RM835.0 million annually over the next five years. Financial obligations under the new programme will be met through this strong recurring cash flow. PJH retains a strong liquidity position with cash and bank balances of RM853.6 million as at end-December 2020.

PJH’s existing issuances:

• RM370.0 million Sukuk Musharakah Programme (due 2030) at AAA_IS;
• RM3.0 billion Sukuk Musharakah Programme (due 2032) at AAA_IS; and
• RM1.5 billion Sukuk Musharakah Medium-Term Notes (MTN) Programme (due 2033) at AAA_IS.