Published on 04 Oct 2019.
RAM Ratings has assigned a final AA2/Stable rating to Edra Solar Sdn Bhd’s (the Company) RM245 mil ASEAN Sustainability SRI Sukuk (2019/2037) (the Sukuk) – the first such sukuk in Malaysia.
Under a 25-year Power Purchase Agreement (PPA) with Tenaga Nasional Berhad, Edra Solar has been contracted to design, construct, own, operate and maintain a solar photovoltaic plant with a capacity of 50 MWac (the Plant or the Project) in Kuala Ketil, Kedah. The Project also incorporates a social element; Edra Solar has allocated a buffer zone surrounding the solar farm facility to the local community, for the cultivation of pineapples and/or other crops. Already in operation for seven months since 25 February 2019, the Plant had been completed ahead of the scheduled commercial operations date in the PPA and within budget.
The Sukuk, equivalent to 78% of the total project cost, is to partly refinance the shareholder’s loan that had been obtained to fund the construction of the Plant. Edra Solar is wholly owned by Edra Power Holdings Sdn Bhd (rated AA1/Stable/P1 by RAM) - Malaysia’s second largest group of independent power producer.
In assigning the final ratings, RAM has reviewed all the relevant transaction documents and assumptions applied. We find them to be in line with our expectations when the preliminary ratings had been assigned (published on 6 September 2019). Please refer to our final rating rationale on Edra Solar for further details on the assigned ratings.
Chong Van Nee, CFA
(603) 3385 2482
(603) 3385 2577
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Ratings on Edra Solar Sdn Bhd