MARC Ratings has affirmed its A+_IS(s) and AAA_IS(bg) ratings on Projek Lintasan Sungai Besi-Ulu Klang Sdn Bhd’s (PLSUKE) Sukuk Wakalah Programme of up to RM2.0 billion and bank-guaranteed Facilities of up to RM500.0 million. The latter is guaranteed by Bank Pembangunan Malaysia Berhad which carries a financial institution rating of AAA from MARC Ratings. All ratings carry a stable outlook.

PLSUKE is wholly owned by Projek Lintasan Kota Holdings Sdn Bhd (PROLINTAS), an indirect subsidiary of Permodalan Nasional Berhad (PNB). PLSUKE operates the Sungai Besi-Ulu Kelang Elevated Expressway (SUKE), a 24.4-km toll road running from Sri Petaling to Ulu Kelang in the Klang Valley.

The A+_IS(s) rating on the Sukuk Wakalah reflects the unconditional and irrevocable corporate guarantee provided by PROLINTAS. PROLINTAS’ rating benefits from a two-notch uplift from ultimate parent support, which reflects MARC Ratings’ expectation of a high likelihood of support from PNB as has been demonstrated in the past.

In 2024, average daily traffic rose 32% to 116,583 vehicles and revenue was up by 37% to RM98.3 million. The jump in traffic volume and revenue was mainly supported by the full-year contribution from its Alam Damai Elevated Interchange which opened in October 2023. While the duration and extent of the ramp-up is uncertain, early indications are strong. MARC Ratings expects volume growth to continue into 2025/2026 but likely at a more moderate pace; SUKE’s connectivity to other major urban roads as well as its well-developed catchment areas and strong commuter base would be supportive of growth.

MARC Ratings’ assessment of PLSUKE’s financial profile remains unchanged from last year’s review. Refinancing risk exists due to the bullet repayment amounting to RM4.2 billion maturing in 2027, comprising the Sukuk Wakalah, bank-guaranteed Facilities and Syndicated Islamic Term Facilities, after excluding a pre-funding balance of RM500 million. However, this is mitigated, in the rating agency’s view, by PLSUKE’s linkage to both PROLINTAS and PNB, as well as the parent entities’ strong banking and capital market access, coupled with the long concession life, which is extendable until 2079.