MARC Ratings has affirmed its AA-IS rating on special purpose vehicle WM Senibong Capital Berhad’s (WMSC) Islamic Medium-Term Notes (Sukuk Wakalah) Programme of up to RM1.0 billion. The rating outlook is stable. WMSC is wholly owned by WM Senibong Sdn Bhd.
The rating affirmation considers WM Senibong’s well-established track record in niche property development in Johor, strong operating profit margin, and healthy balance sheet structure. The execution risk related to land reclamation and susceptibility of the group’s financial performance to property market conditions remain key moderating factors.
WM Senibong is a member of Walker Group Holdings Pty Ltd (Walker Group), which holds 43% interest in the company and is one of the largest privately held property groups in Australia. As at the first eight months of financial year ended 30 June 2025 (8MFY2025), the group’s ongoing projects — Senibong Cove and Crest@Austin, both in Johor — had a combined gross development value (GDV) of RM1.4 billion and an overall average take-up rate of 46%. As construction works progress, take-up rates are expected to improve, moreover with the gradual release of unsold units allocated for Bumiputra buyers to the open market. Unbilled sales of RM442.1 million and planned launches averaging RM1.5 billion p.a. over the next three years would provide earnings visibility.
Completed projects registered a combined GDV of RM2.7 billion with a 99% take-up rate as at end-February 2025, reflecting WM Senibong’s strong sales track record. Completed inventory, which stood at RM56.3 million as at end-February 2025, is expected to remain low. WM Senibong’s landbank had substantially increased to 1,130 acres following the acquisition of 960 acres of land adjacent to Crest@Austin, Johor Bahru, in FY2024. The acquisition has been earmarked for mixed development, comprising industrial (40%), residential (40%), and commercial (20%), expected to be launched in 2026. WM Senibong is also expected to acquire about 123 acres of land within The Kews development in Iskandar Puteri from shareholder Walker Group, subject to shareholder approval.
The 102-acre land reclamation works at Senibong Cove is underway. Plot 1 is planned for serviced apartments, hotels, duty-free shops, and a ferry terminal, while Plot 3 will mainly comprise landed residential projects; the first phase of Plot 3 will consist of 110 units of terrace houses (GDV: RM250 million), targeted to be launched in phases from FY2027. The land reclamation works have been partially funded through a drawdown of RM310 million under the sukuk programme. This has resulted in a sharp rise in group borrowings to RM430.2 million in 8MFY2025, translating into a debt-to-equity (DE) ratio of 0.45x (FY2024: RM46.3 million; 0.05x). Borrowings are expected to increase further to acquire the 123 acres of The Kews land in the near term, potentially increasing the DE ratio to about 0.60x. WM Senibong is exploring an equity fundraising exercise in 2026 which could ease leverage to around 0.30x.
WM Senibong recorded revenue and profit before tax of RM268.7 million and RM81.7 million in 8MFY2025, supported by commercial sales from Crest@Austin. Operating profit margin has remained strong at above 30% over the past three years. Progress billings from its ongoing projects and new launches under existing developments would support performance growth in the near-to-medium term.