[RAM] RAM Ratings upgrades Solarvest's sukuk to AA3

RAM Ratings has upgraded the long-term rating of Solarvest Holdings Berhad’s (Solarvest or the Group) RM1 bil Islamic Medium-Term Notes/Islamic Commercial Papers Programme (2023/2053) to AA₃ from A₁. Concurrently, the outlook on the facility has been revised to stable from positive. The short-term rating remains at P1. 

The upgrade reflects Solarvest’s stronger business fundamentals and meaningful growth, underpinned by its enlarged order book which more than doubled to RM1.2 bil as at end-June 2025 (end-July 2024: RM469 mil). Despite the fragmented and competitive Malaysian solar engineering, procurement, construction and commissioning (EPCC) market, Solarvest’s differentiated value proposition is a competitive advantage and cements its market leadership. As at end-June 2025, its tender pipeline was a robust 7.2 GWp. 

Solarvest achieved record-high revenue and operating profit before depreciation, interest and taxes (OPBDIT) of RM536.8 mil and RM93.0 mil, respectively in FY Mar 2025. OPBDIT margin was robust at 17.3% from full earnings recognition from its Large-Scale Solar 4 assets and record-low equipment prices. The Group also achieved notable income diversification from renewable energy generation and O&M segments. This translated into a higher adjusted funds from operations debt coverage (FFODC) ratio of 0.27 times as at end-March 2025, notwithstanding a heavier debt load to meet working capital needs. 

Our sensitised cashflow projection for the next three years indicates that the Group will stay in a net cash position, with adjusted gearing and adjusted FFODC averaging a respective 0.51 times and 0.32 times, outperforming rated peers. Cashflow from operating activities net of capital expenditure (capex), is anticipated to remain negative for some time given higher annual capex of RM525 mil. That said, the Group maintains a strong liquidity profile, backed by undrawn facilities and access to the capital market.


Analytical contacts
Joel Thum 
(603) 2708 8232
joel@ram.com.my 

Chong Van Nee, CFA 
(603) 2708 8210
vannee@ram.com.my 

Media contact
Sakinah Arifin
(603) 2708 8212
sakinah@ram.com.my