[RAM] RAM Ratings affirms Bumitama's sukuk at AA2/Stable

RAM Ratings has affirmed the AA₂/Stable rating on Bumitama Agri Ltd’s (Bumitama or the Group) RM2.0 bil Islamic MTN Sukuk Musharakah (2014/2029). This reflects the Group’s strong operational efficiency, conservative leverage and healthy cash flow generation, which continue to underpin its robust financial metrics.

With a cultivated area of 186,256 hectares in Indonesia as of June 2025, Bumitama ranks among the region’s top 10 listed plantation companies by planted area, reinforcing its competitive positioning. The Group outperformed expectations in profitability and leverage metrics, with operating profit before depreciation, interest, and tax surging 49.07% to IDR 2.55 tril and OPBDIT margin of 26.1% in 1H FY Dec 2025 (FY Dec 2024: IDR 4.39 tril and 26.3%). This strong performance was driven by higher plantation yields and favorable crude palm oil prices, a momentum we anticipate to persist in the near term.

Despite higher dividend payouts, Bumitama maintained a strong balance sheet, with gearing at 0.20 times (end-December 2024: 0.19 times) and annualised funds from operations debt cover at a robust 1.28 times in 1H FY Dec 2025 (FY Dec 2024: 1.08 times). The Group’s low debt levels and strong cash generation provide sufficient headroom to fund annual capex of IDR 1.4–1.7 tril without additional borrowings, supporting a resilient credit profile ahead of the sukuk maturity in July 2026.

The Group’s robust financial profile, strong cash flow generation, and extensive banking relationships provide significant flexibility for refinancing. As of end-June 2025, the Group has no debt maturing within the year, and its cash and cash equivalents amount to roughly half of its total debt, underscoring solid liquidity.

Nevertheless, the Group’s inherent exposure to volatile commodity prices, the challenging operating environment in Indonesia, and on-going international regulatory scrutiny of environmental practices remain moderating factors to the rating.


Analytical contact
Chew Wei Li
(603) 2708 8301
weili@ram.com.my

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

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