MARC has affirmed its rating of AA-IS on Cerah Sama’s RM420m Sukuk with a stable outlook. Cerah Sama is the investment holding company of Grand Saga, the concessionaire of the 11.5-kilometre Cheras-Kajang Highway.
The rating mainly reflects Cheras-Kajang Highway’s steady traffic performance that supports Cerah Sama’s cash flow generation to meet its financial obligation. The rating also considers the concessionaire’s adequate cash balances as well as its accommodative Sukuk repayment profile. The rating is moderated by Cerah Sama’s weak leverage position and the potential impact from the Klang Valley Mass Rapid Transit Line 1 on Cheras-Kajang Highway’s traffic volume.
The stable outlook incorporates MARC’s expectations that Cheras-Kajang Highway would continue to exhibit satisfactory traffic performance and Cerah Sama will maintain its strong business and financial profiles. Any downward pressure on the rating would likely hinge on any adverse changes on the concessionaire’s credit profile and/or prolonged traffic underperformance.