RAM Reaffirms AA3/Stable Rating of Bumitama Agri’s MYR 2 Billion Sukuk Musharakah

RAM Rating Services (RAM) has reaffirmed the rating of Bumitama Agri’s (Bumitama or the Group) MYR 2 billion Islamic Medium-Term Notes Sukuk Musharakah (2014/2029) at AA3/Stable.

Bumitama is a producer of palm oil and palm kernel, with an oil palm plantation in Indonesia and is listed on the Singapore Exchange. The reaffirmation is based on the Group’s performance in the first half of 2020 (1H 2020), which was within RAM’s expectations. According to RAM, Bumitama’s credit metrics will be maintained at levels corresponding with the current issue rating as the temporary crude palm oil price (CPO) reversals will be offset by stronger production.

RAM noted that although Bumitama’s production of fresh fruit branches (FFBs) were lower than ant...