RAM: Encorp Systembilt’s MYR 1.575 Billion Sukuk Murabahah Rating Reaffirmed at AA1

June 22, 2020

RAM Ratings (RAM) has reaffirmed Encorp Systembilt (ES)’ MYR 1.575 billion Sukuk Murabahah at a rating of AA1/Stable. ES is the concessionaire for the development of 10,000 units of teachers’ accommodation quarters across Malaysia, which were constructed in 2003 and handed over to the Government of Malaysia in early 2004.

RAM’s rating reaffirmation incorporates ES’ strong ability to service its debt, supported by the tight transaction structure and extremely predictable inflow of monthly concession payments from the Government of Malaysia, through the Ministry of Education. RAM noted that these concession payments are unconditional, as ES is not obligated to maintain the quarters.