MARC Ratings has affirmed its MARC-1IS/AAIS ratings on Alam Flora Sdn Bhd’s RM700 million Islamic Commercial Papers and Islamic Medium-Term Notes (ICP/IMTN) Programmes, with a stable outlook.
The ratings are underpinned by Alam Flora’s long-term concession with the Government of Malaysia, which provides strong revenue visibility and stable cash flow generation. Additional support stems from the group’s extensive operating track record and healthy liquidity position. These strengths are moderated by execution risks related to the expansion of its non-concession businesses.
Alam Flora’s company-level revenue grew by 3.6% to RM815.7 million in 2025, supported by new developments within its concession areas. A scheduled fee revision remains under government review and, if approved, together with continued growth from new developments, is expected to support revenue growth in 2026. Operating cash flow remained stable at RM124.9 million, while liquidity stayed healthy, supported by cash and bank balances of RM205.0 million as at end-2025.
Alam Flora expects to incur RM284 million in capex over 2026–2029, primarily for concession asset replacements, alongside approximately RM95 million for the development of a scheduled waste management facility in Terengganu over 2026–2027. While the group plans to raise about RM300 million under its IMTN programme between 2026 and 2028 to partly fund these investments, it is expected to remain in a net cash position throughout the projection period to 2033, supported by strong cash generation and high cash retention.