MARC Ratings has revised its outlook on Sunway Group’s sukuk programme ratings to positive from stable. The list of issuances is appended at the end of this press release.
The outlook revision is premised on the prospect of significant improvements in group leverage measures from the impending listing of group healthcare entity Sunway Healthcare Holdings Berhad (SHH), and the sustained improvements in the group’s earnings profile in recent years. Sunway Berhad, through its wholly-owned subsidiary Sunway City Sdn Bhd, will dispose of up to 502.7 million shares, excluding over-allotment, raising gross proceeds of up to RM729.0 million. These proceeds will mainly be used for the redemption of medium-term notes (MTN) and/or repayment of bank borrowings as well as property development and property investment expenditure.
Upon completion of the listing, the substantial increase in equity reserve from the re-measurement of the group’s interest in SHH would reduce Sunway’s leverage. Following the consolidation of SHH into Sunway with the enlarged equity base, the debt-to equity (DE) and net DE ratios are estimated to improve to around 0.55x and 0.31x.
Group performance continued to improve in 2025 with stronger operating performance across all business segments, particularly the construction segment, except property development segment. The property investment segment recorded better performance primarily supported by the new income contributions from Sunway Square’s property investment assets and Sunway Wangsa Mall, as well as higher income from Sunway REIT, on its expanded portfolio. Performance in the construction segment improved largely due to higher contributions from the accelerated progress of data centre projects. Higher earnings from the two segments offset lower profit from property development operations, with lower progress billings as several projects were in the early stages of construction. The healthcare segment was impacted by start-up losses from SMC Damansara and SMC Ipoh. Excluding the losses from the new hospitals, share of results from the healthcare segment would improve by 27.7% driven by increased licensed bed capacity and improved census performance.
MARC Ratings is conducting the annual rating review on Sunway Group’s issuances during which the next rating action will be considered, and expects to complete the exercise in May 2026. The group’s rated issuances are as follows:
- Sunway Treasury Sukuk Sdn Bhd’s RM3.0 billion Islamic Commercial Papers/ Islamic Medium-Term Notes (ICP/IMTN) Programme with a rating of MARC-1IS(cg)/AA-IS(cg)
- Sunway’s RM2.0 billion CP/MTN Programme with a rating of MARC-1/AA-
- Sunway’s RM5.0 billion Perpetual Sukuk Programme with a rating of AIS
- Sunway Treasury Sukuk’s RM10.0 billion IMTN Programme with a rating of AA-IS; and
- Sunway Treasury Sukuk’s RM10.0 billion ICP/IMTN Programme with a rating of MARC-1IS(cg)/AA-IS(cg).