Skip to content
  • Group
    • About MARC
    • Leadership
    • Investor Relations
    • Notable Issuances
    • MARC Ratings
    • MARC Solutions
    • MARC Data
    • MARC Learning
    • Careers
  • Services
    • Credit Ratings & Related Assessments
    • Sustainability-Related Assessments
    • Economic & Fixed-Income Analysis
    • Sustainability-Related Advisory
    • Debt Advisory
    • Analytics Consulting Services
    • Subscriptions
    • Data Analytics
    • Credit Reporting
    • Learning Programmes
  • Insights
    • Rating Announcements
    • Research & Analysis
    • Views
    • MARC in the Media
    • Newsfeed
    • Latest@MARC
  • Events & CSR
  • Contact Us
    • Contact Us
    • Service Level Feedback Form
    • Publication Feedback Form
    • Whistleblowing
Menu
  • Group
    • About MARC
    • Leadership
    • Investor Relations
    • Notable Issuances
    • MARC Ratings
    • MARC Solutions
    • MARC Data
    • MARC Learning
    • Careers
  • Services
    • Credit Ratings & Related Assessments
    • Sustainability-Related Assessments
    • Economic & Fixed-Income Analysis
    • Sustainability-Related Advisory
    • Debt Advisory
    • Analytics Consulting Services
    • Subscriptions
    • Data Analytics
    • Credit Reporting
    • Learning Programmes
  • Insights
    • Rating Announcements
    • Research & Analysis
    • Views
    • MARC in the Media
    • Newsfeed
    • Latest@MARC
  • Events & CSR
  • Contact Us
    • Contact Us
    • Service Level Feedback Form
    • Publication Feedback Form
    • Whistleblowing
  • Sign In
  • Subscribe
  • Group

    Group

    The MARC Group of Companies comprises MARC Ratings, MARC Solutions, MARC Data and MARC Learning.

    • About MARC
    • Leadership
    • Investor Relations
    • Notable Issuances
    • About MARC
    • Leadership
    • Investor Relations
    • Notable Issuances
    • MARC Ratings
    • MARC Solutions
    • MARC Data
    • MARC Learning
    • MARC Ratings
    • MARC Solutions
    • MARC Data
    • MARC Learning

    MARC Ratings

    • Rating Guide
    • Rating Process
    • Rating Symbols & Definitions
    • Rating Methodologies
    • Regulatory
    • Lead Managers

    MARC Solutions

    MARC Data

    MARC Learning

    • Careers
    • Careers
  • Services

    Services

    MARC's subsidiaries each provide distinct product offerings and services.

    • Credit Ratings & Related Assessments
    • Sustainability-Related Assessments
    • Economic & Fixed-Income Analysis
    • Credit Ratings & Related Assessments
    • Sustainability-Related Assessments
    • Economic & Fixed-Income Analysis
    • Sustainability-Related Advisory
    • Debt Advisory
    • Analytics Consulting Services
    • Sustainability-Related Advisory
    • Debt Advisory
    • Analytics Consulting Services
    • Subscriptions
    • Data Analytics
    • Credit Reporting
    • Learning Programmes
    • Subscriptions
    • Data Analytics
    • Credit Reporting
    • Learning Programmes
  • Insights

    Insights

    Find the vital information you need and stay up to date with the latest news from MARC.

    • Rating Announcements
    • Research & Analysis
    • Views
    • Rating Announcements
    • Research & Analysis
    • Views
    • MARC in the Media
    • Latest@MARC
    • MARC in the Media
    • Latest@MARC
  • Events & CSR

    Events & CSR

    MARC organises a diverse range of events throughout the year to engage with all stakeholders.

    • MARCares
    • Events
    • MARCares
    • Events
  • Contact Us

    Contact Us

    Let's get the conversation started - Get in touch with us!

    • Contact Us
    • Service Level Feedback Form
    • Publication Feedback Form
    • Whistleblowing
    • Contact Us
    • Service Level Feedback Form
    • Publication Feedback Form
    • Whistleblowing
MARC Online
Subscribe
Menu
  • Group
  • Services
  • Insights
  • Events & CSR
  • Contact Us
Menu
  • Group
  • Services
  • Insights
  • Events & CSR
  • Contact Us
Credit Ratings & Related Assessments
Sustainability- Related Assessments
Economic & Fixed-Income Analysis
Subscriptions
Sustainability- Related Advisory
Debt Advisory
Analytics Consulting Services
Data Analytics
Credit Reporting
Learning Programme

Credit Ratings & Related Assessments

Sustainability- Related Assessments

Economic & Fixed-Income Analysis

Subscriptions

Sustainability- Related Advisory

Corporate & Debt Restructuring Advisory

Analytics Consulting Services

Data Analytics

Credit Reporting

Learning & Customised Programme

  • Insights
  • Rating Announcements
Rating

MARC revises TSH’s ratings outlook to positive

5 October 2021

View Reports

Contacts

Lim Wooi Loon, +603-2717 2943/ wooiloon@marc.com.my
Taufiq Kamal, +603-2717 2951/ taufiq@marc.com.my
Umar Abdul Aziz, +603-2717 2962/ umar@marc.com.my

Posted Date: October 05, 2021

MARC has affirmed its rating of A+IS and MARC-1IS on TSH Sukuk Murabahah Sdn Bhd’s RM150 million Medium-Term Notes (IMTN) Programme and RM50 million Commercial Papers (ICP) Programme. Concurrently, the rating agency has affirmed its rating of A+IS on TSH Sukuk Ijarah Sdn Bhd’s RM300 million IMTN programme. The long-term ratings outlook has been revised to positive.

Both TSH Sukuk Murabahah and TSH Sukuk Ijarah are special purpose funding vehicles of TSH Resources Berhad (TSH) which has given an irrevocable and unconditional undertaking to meet the purchase obligations of these subsidiaries. The rating consideration is therefore based on the strength of TSH.

The outlook revision to positive is premised on the TSH group’s improved financial performance on the back of the resurgent crude palm oil (CPO) price environment since 4Q2020 that has strengthened its credit metrics. In 1H2021, TSH recorded a higher average CPO price of RM3,242/MT (2020: RM2,453/MT) that contributed to a 17.8% y-o-y increase in revenue to RM551.5 million. During this period, cash flow from operations (CFO) grew sharply by 31.2% y-o-y to RM159.2 million. Accordingly, CFO interest and debt coverages improved to 7.6x and 0.2x (2019: 3.5x; 0.1x).

We note that TSH group borrowings stood at RM1.2 billion as at end-June 2021, translating to a gross debt-to-equity (DE) ratio of 0.74x (2019: 0.91x). We also understand that proceeds of RM248 million from TSH’s impending sale of a combined 3,007 ha plantation with a palm oil mill in Kinabatangan, Sabah will be used to pare down borrowings. This would result in the group’s gross DE ratio to further improve to about 0.6x. The sale is expected to be completed by 1Q2022.

TSH’s lengthy track record in oil palm cultivation and favourable tree maturity profile that have yielded strong production metrics remain key rating drivers. We also view that the recent strong financial performance has provided headroom to undertake additional planting. The group has unplanted area of about 57,000 ha and planted area of 42,470 ha of which 45% comprises prime age trees. With about 43% comprising immature and young matured trees, fresh fruit bunch (FFB) production is expected to benefit over the medium term. For 1H2021, FFB production grew by 13.2% y-o-y to 483,338 MT. The ratings remain moderated by cross-border risk from its operations in Kalimantan, Indonesia where the majority of its plantations are located.

The long-term ratings could be upgraded if TSH sustains its production metrics and maintains the improvement in its credit metrics including gross leverage position of about 0.7x. Total notes outstanding are RM200.0 million under the Sukuk Murabahah IMTN and ICP programmes and RM25.0 million under the Sukuk Ijarah IMTN programme as at end-September 2021.

Contacts:
Lim Wooi Loon, +603-2717 2943/ wooiloon@marc.com.my;
Umar Abdul Aziz, +603-2717 2962/ umar@marc.com.my;
Taufiq Kamal, +603-2717 2951/ taufiq@marc.com.my.

List related news | List related issues | List related reports

Related Report

Read More

Related Issues

Read More

Related News

Read More

You May Also Like To Read

See All
Ratings

MARC Ratings assigns final ratings of MARC-1IS/AA-IS to UDA’s ICP/IMTN Programmes of up to RM1.0 billion

22 March 2023

Ratings

MARC Ratings revises UiTM Solar's rating outlook to stable

22 March 2023

Ratings

MARC Ratings assigns final rating of A to Singer’s RM300.0 million MTN Programme

22 March 2023

See All

Let’s get started.

Subscribe to our mailing list today

Subscribe Now
Group
  • About MARC
  • Leadership
  • Investor Relations
  • Notable Issuances
  • Careers
Regulatory
  • Rating Reviews Summary
  • List of Defaults
  • List of Credit Ratings Published
  • List of Entities on Rating Watch
Services
  • Credit Ratings & Related Assessments
  • Sustainability-Related Assessments
  • Economic & Fixed-Income Analysis
  • Sustainability-Related Advisory
  • Corporate & Debt Restructuring Advisory
  • Subscriptions
  • Analytics Consulting Services
  • Data Analytics
  • Credit Reporting
  • Learning & Customised Programmes
Subsidaries
  • MARC Ratings
  • MARC Learning
  • MARC Data
  • MARC Solutions
Insights
  • Rating Announcements
  • Research & Analysis
  • Views
  • Latest@MARC
  • MARC in the Media
Events
  • Corporate Events
  • Corporate Social Responsibility (CSR)
  • Advertise with MARC
Contact Us
  • Contact Us
  • Service Level Feedback Form
  • Publication Feedback Form
  • Whistleblowing
  • Group
    • About MARC
    • Leadership
    • Investor Relations
    • Notable Issuances
    • MARC Ratings
    • MARC Solutions
    • MARC Data
    • MARC Learning
    • Careers
  • Services
    • Credit Ratings & Related Assessments
    • Sustainability-Related Assessments
    • Economic & Fixed-Income Analysis
    • Sustainability-Related Advisory
    • Debt Advisory
    • Analytics Consulting Services
    • Subscriptions
    • Data Analytics
    • Credit Reporting
    • Learning Programmes
  • Insights
    • Rating Announcements
    • Research & Analysis
    • Views
    • MARC in the Media
    • Newsfeed
    • Latest@MARC
  • Events & CSR
  • Contact Us
    • Contact Us
    • Service Level Feedback Form
    • Publication Feedback Form
    • Whistleblowing
Terms & Conditions
Privacy Notice
Copyright Notice
Whistleblowing
PDPA Notice
© 2023 Malaysian Rating Corporation Berhad. All rights reserved.
Facebook Twitter Linkedin

Join MARC Mailing List

I would like to subscribe this mailing list. Please tick whichever is applicable

I agree/ do not agree (please tick whichever is applicable) to receive future events, conferences or marketing materials from MARC. *

Privacy Notice *

Declaration *