MARC Ratings has affirmed OCK Group Berhad's (OCK) Islamic Commercial Papers (ICP) Programme rating at MARC-1IS and its Sukuk Murabahah Programme rating at AA-IS/Stable. The rating agency has considered the potential reduction in OCK's ICP Programme to RM200.0 million (from RM500.0 million) and the concurrent increase in its Sukuk Murabahah Programme to RM1.0 billion (from RM700.0 million) in its assessment. The total programme limit remains at RM1.2 billion.

The ratings reflect OCK's stable business model and two decades of experience in the telecommunications (telecom) tower sector, supporting consistent performance. Long-term contracts with tenants and strong infrastructure demand provide revenue visibility and growth prospects. Expansion into solar energy, backed by power purchase agreements (PPA), further supports sustainable growth and financial stability. However, risks include potential leverage increases, contract renewal uncertainties, and regional cross-border challenges.

As of end-2024, OCK's towerco business - which builds, owns, and leases telecom towers to mobile operators - comprises 5,500 towers with 7,286 tenancies across Malaysia, Vietnam, and Myanmar. The tower count has remained steady, and between 2025 and 2028, OCK plans to add 1,050 towers - 450 in Malaysia and 600 in Vietnam - to meet growing telecom demand. In its managed services segment, where it maintains towers for telcos, OCK manages 55,756 towers in Indonesia (contributing to about 22% of total revenue) and 11,300 towers in Malaysia.

In Malaysia's oligopolistic telco market, OCK faces client concentration risk, with U Mobile representing 51% of tenancies and 53% of managed towers. However, U Mobile's lead role in deploying the country's second 5G network offers significant growth potential. Risks from concentration and non-renewals are mitigated by long-term leases, strong client ties, the strategic importance of towers, and limited site alternatives.

OCK owns 29 small-sca