MARC Ratings has affirmed its rating on Sime Darby Property Berhad’s (SD Property) RM4.5 billion Islamic
Medium-Term Notes (IMTN) Programme (Sukuk Musharakah) at
AA+_IS with a stable outlook.
The outstanding under the rated programme stood at RM800.0 million as of November 30, 2022.

SD Property’s continued strong sales track record in its well-established townships, and healthy balance
sheet characterised by low leverage position remain key rating drivers. The rating benefits from a one-notch
uplift for implicit support from parent Permodalan Nasional Berhad (PNB), a government-linked investment company.

SD Property recorded an average take-up rate of 92% as at November 6, 2022 for recent launches.
This is attributable to its long and successful track record as a township developer as well as the
good location of its projects that have strong connectivity. Unbilled sales of RM3.5 billion provide
earnings visibility through 2024. In terms of inventory management, the group has continued to clear
its completed inventories, which reduced to a modest gross development value of RM389.7 million as at end-September 2022.

For its industrial/logistics developments, mainly in Bandar Bukit Raja, and the Elmina Business
Park, SD Property recorded an average take-up rate of 88% as at November 6, 2022 for recent launches.
Aiming to capitalise on the demand for space for distribution centres and cold-chain logistics, these developments are expected to boost recurring income streams.

Group revenue stood at RM1.8 billion and pre-tax profit at RM323.1 million in 9M2022. Total borrowings of RM3.5
billion is expected to increase to partially fund its call option exercise on land for industrial developments of
about RM808 million. Gross debt-to-equity ratio is projected to increase to about 0.46x from 0.37x as at end-September 2022.
Its unrestricted cash balances of RM546.1 million and unutilised credit lines of RM3.7 billion under the IMTN programme provide
support to operational and strategic activities.