[RAM] RAM Ratings affirms IJM Land's A2(s) issue rating

RAM Ratings has affirmed the A₂(s)/Stable rating of IJM Land Berhad’s RM2 bil Perpetual Sukuk Programme. The rating reflects the unconditional and irrevocable subordinated guarantee from its parent, IJM Corporation Berhad (IJM Corp or the Group), whose debt securities are rated AA₃/Stable by RAM. The sukuk rating is two notches below IJM Corp’s rating, reflecting the deferrable nature of profit distributions and subordinated claims of sukukholders in the event of insolvency. The (s) modifier indicates a purchase undertaking by IJM Land to acquire sukukholders’ interests.

As the property development arm of IJM Corp, IJM Land has, on average, contributed over half of the Group’s pre-tax profits in the last three fiscal years and continues to benefit from consistent unsecured advances, underscoring its strategic importance to its parent. In FY Mar 2025, IJM Land recorded lower y-o-y sales (RM1.5 bil) and revenue (RM1.6 bil), primarily due to the timing of project launches – approximately 85% of gross development value was launched in the final quarter – and softer buyer sentiment. However, operating profit before depreciation, interest and tax and pre-tax profit remained resilient at a respective RM350.2 mil (+8.3% y-o-y) and RM318.9 mil (-10.0% y-o-y). IJM Land’s leverage stayed conservative, with a gearing ratio of 0.49 times (FY Mar 2024: 0.47 times), while funds from operations debt coverage was kept steady at 0.10 times (FY Mar 2024: 0.11 times).

Cooling property market conditions and ongoing economic uncertainties saw total residential property transactions nationwide retreat by 1.4% in 1H 2025, with total transaction value remaining broadly flat. Despite these headwinds, IJM Land’s large cash reserves (RM727.9 mil, excluding restricted balances in Housing Development Accounts), manageable debt maturities, extensive landbank and ongoing corporate support are expected to provide operational flexibility. These factors should enable the Group to adjust project launches as needed, drive sales of ongoing projects and convert unbilled sales (end-March 2025: RM1.5 bil) into revenue.


Analytical contacts
Ben Inn    
(603) 2708 8290
ben@ram.com.my

Thong Mun Wai
(603) 2708 8255
munwai@ram.com.my

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