MARC Ratings has affirmed its AAAIS rating on Putrajaya Bina Sdn Bhd’s (PBSB) RM1.58 billion Islamic Medium-Term Notes (Sukuk Wakalah) Programme. The rating outlook is stable.
The affirmed rating is driven by the steady periodic payment streams in the form of availability charges (AC) from its sole obligor, the Malaysian government (AAA/Stable), the quantum of which is sufficient to meet the financial obligations under the Sukuk Wakalah programme. PBSB also benefits from its status as a wholly-owned subsidiary of Putrajaya Holdings Sdn Bhd (PJH, rated AAA/Stable), the master developer of the federal government administrative capital in Putrajaya.
PBSB had developed nine blocks of government office buildings and one block of shared facilities in Parcel F, Precinct 1 in Putrajaya under a government concession agreement. The development was completed in April 2019, ahead of its scheduled completion in December 2019. In return for developing the properties, PBSB receives AC payments under a 25-year asset management phase of the concession agreement. The AC payments amount to RM215.6 million p.a.
The company also receives maintenance charges (MC) of RM69.2 million p.a. subject to meeting specific key performance indicators. As at date, PBSB has been receiving MC payments in full. The MC payments provide an additional buffer to the covenanted financial service cover ratio (FSCR) of 1.50x. The FSCR would stand at 2.32x at end-2022 based on the projected cash flow.