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RAM Ratings upgrades Exsim Capital
Published on 12 Jun 2025.
RAM Ratings has upgraded the rating of Exsim Capital Resources Berhad’s (Exsim Capital or the Issuer) RM365 mil Tranche 5 Islamic medium term notes (IMTN) to AA2/Positive from AA3/Stable. We have also affirmed the AA3/Stable ratings of the Issuer’s RM300 mil Tranche 4 and RM310 mil Tranche 6 IMTN. These issuances were made under Exsim Capital’s RM2 bil Sukuk Musharakah Programme.
The upgrade of the Tranche 5 IMTN rating reflects the advanced construction progress of the underlying projects – D’Clover Residences (92%) and D’Terra Residences (86%). The handover of vacant possession (VP) to homeowners is largely on track for 2Q 2026 (i.e. May 2026), with ample time buffers until the legal VP dates in February 2027 to mitigate any external delays. As both projects’ physical structures have reached rooftop level with mainly internal work remaining, construction risk is minimal. The rating outlook is positive on our expectation that the Tranche 5 IMTN will become fully cash-backed upon VP delivery by 2Q 2026, about a year ahead of the legal VP dates.
The Tranche 4 and Tranche 6 IMTN rating affirmations are premised on the available time buffer between the targeted Certificate of Completion and Compliance (CCC)/VP and expected maturity dates, the transactions’ adequate liquidity and the construction progress of the underlying projects. During the review period, the construction period for Kyliez Suites (backing Tranche 6) was revised from 39 months to 46.5 months through a supplemental agreement.
The developer anticipates further extensions to the contractors for Fiddlewoodz, D’Clover and D’Terra projects owing to ongoing logistical and/or space challenges. VP for Hugoz is nevertheless still expected to be delivered within the legal CCC/VP timeframe, while VP dates for The Fiddlewoodz and Kyliez may coincide with some sales and purchase agreements’ earlier legal delivery dates. Any exposure to liquidated damages is envisaged to be minimal. All projects remain on schedule for completion before the respective expected maturity dates.
The liquidity positions of the Tranche 4 and Tranche 6 IMTN continue to be supported by healthy buyer profiles and the respective unrated Islamic commercial papers (ICP) facilities established alongside the IMTNs. Since issuance, the default rates of the three projects have stayed well below RAM’s applied default frequency (The Fiddlewoodz: 1.7%; Hugoz: 0.2%; Kyliez: nil). As at end-March 2025, The Fiddlewoodz and Kyliez each had one unsold unit while Hugoz had seven. Looking ahead, we expect minimal drawdowns from the ICP facilities as all projects are anticipated to generate positive net monthly cash flows as construction progresses. No construction cost overruns have been observed to date, largely owing to the fixed-price lump-sum contracts.
Analytical contacts
Joel Thum
(603) 2708 8232
joel@ram.com.my
Lim Chern Yit
(603) 2708 8302
chernyit@ram.com.my
Media contact
Sakinah Arifin
(603) 2708 8212
sakinah@ram.com.my
The credit rating is not a recommendation to purchase, sell or hold a security, inasmuch as it does not comment on the security’s market price or its suitability for a particular investor, nor does it involve any audit by RAM Ratings. The credit rating also does not reflect the legality and enforceability of financial obligations.
RAM Ratings receives compensation for its rating services, normally paid by the issuers of such securities or the rated entity, and sometimes third parties participating in marketing the securities, insurers, guarantors, other obligors, underwriters, etc. The receipt of this compensation has no influence on RAM Ratings’ credit opinions or other analytical processes. In all instances, RAM Ratings is committed to preserving the objectivity, integrity and independence of its ratings. Rating fees are communicated to clients prior to the issuance of rating opinions. While RAM Ratings reserves the right to disseminate the ratings, it receives no payment for doing so, except for subscriptions to its publications.
Similarly, the disclaimers above also apply to RAM Ratings’ credit-related analyses and commentaries, where relevant.
Published by RAM Rating Services Berhad
© Copyright 2025 by RAM Rating Services Berhad
Rating Rationale: Exsim Capital Tranche 4
Rating Rationale: Exsim Capital Tranche 5
