MARC RATINGS AFFIRMS RATINGS ON SUNWAY GROUP'S ISSUANCES

MARC Ratings has affirmed its ratings on Sunway Group's issuances as follows:

- Sunway Berhad's RM2.0 billion Commercial Papers/ Medium-Term Notes (CP/MTN) Programme at MARC-1/AA-
- Sunway Berhad's RM5.0 billion Perpetual Sukuk Programme at AIS
- Sunway Treasury Sukuk Sdn Bhd's RM10.0 billion Islamic Medium-Term Notes (IMTN) Programme at AA-IS; and
- Sunway Treasury Sukuk Sdn Bhd's RM10.0 billion ICP/IMTN Programme at MARC-1IS(cg)/AA-IS(cg).

The outlook on all ratings is stable.

Sunway's strong operating track record and established market position in the property and construction sectors remain key rating strengths. While cash flow metrics have improved, rising borrowings and execution risks arising from the expansion of its business activities, particularly across the group's international property development and domestic healthcare sectors, continue to weigh on its credit profile.

With the progressive completion of several domestic and international projects, Sunway launched new developments with a combined gross development value (GDV) of RM2.7 billion in 2024, followed by an additional RM358.0 million as at end-May 2025. The overall lower take-up rate of 69.9% as at end-1Q2025 (2024: 73.4%) was mainly attributed to the relatively nascent stage of the recently launched projects. As at end-1Q2025, Sunway's RM9.0 billion ongoing property projects had generated about RM4.0 billion in unbilled sales, providing earnings visibility over the next three years. Currently, the group has domestic property development projects of RM4.7 billion, with overseas projects in Singapore (RM4.0 billion) and China (RM372.0 million). It plans to launch other projects with a combined GDV of RM4.1 billion in 2025, focusing on its core Klang Valley market, the upcoming Johor market and the persistently strong demand for executive condominiums in Singapore.

Meanwhile, the outstanding external construction orde