RAM Ratings affirms TM Tech's sukuk at AAA 

RAM Ratings has affirmed the AAA/Stable ratings of TM Technology Services Sdn Bhd's (TM Tech) following sukuk facilities: 
 
               Instrument                  Rating(s)
RM3 bil Islamic MTN Programme (2013/2033)  AAA/Stable
RM4 bil Islamic MTN Programme (2018/2048) AAA/Stable

The ratings reflect Telekom Malaysia Berhad's (TM or the Group) superior credit profile and TM Tech's integral role as its core operating and earnings entity following an internal reorganisation in 2023. TM Tech, a wholly owned subsidiary of TM, now houses the Group's core operating businesses and remains its main earnings contributor. Given the high degree of financial and operational integration, RAM assesses TM and TM Tech on a consolidated basis, aligning TM Tech's sukuk ratings with the Group's credit standing. While TM's position as the national fibre infrastructure provider and its government linkages warrant a rating uplift, none has been applied in view of its strong standalone credit profile. 

TM leads the retail fixed broadband market, with an estimated 64% market share and 3.22 mil subscribers as at end-March 2026 (end-2024: 3.18 mil), while its average monthly revenue per user was RM132, above that of rated peers. Its business-to-business (under TM One) and carrier-to-carrier segments (led by TM Global) afford earnings diversification, together contributing about half of the Group's top line. Demand for connectivity and digitalisation is expected to remain favourable, although competition may limit margin expansion. TM continues to expand into adjacent businesses including data centres, electric vehicle charging and solar energy solutions Its joint venture with Singapore Telecommunications Limited's (Singtel) subsidiary - Nxera My Pte Ltd, to develop a Tier 3 data centre in the Johor-Singapore Special Economic Zone adds longer term earnings potential, with Phase 1 expected to commence operations in 3Q 2026.

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