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RAM Ratings upgrades YTL Corp’s ratings to AAA
Published on 28 Jan 2026.
RAM Ratings has upgraded the long-term rating of YTL Corporation Berhad’s (YTL Corp or the Group) debt programmes (Table 1). Concurrently, the outlook on the facilities has been revised to stable from positive. The short-term rating remains at P1.
The rating upgrade reflects demonstrated and sustained improvements in YTL Corp’s fundamental operating and financial profile, underpinned by robust performance across Group’s core investments. The Group’s return on capital employed (ROCE) has strengthened to 8%–10% over the past two years (vs. ~5% previously), supported by resilient earnings across its regulated utilities, cement, hospitality and property segments. The Group’s diversified business portfolio, further complemented by excellent liquidity and financial flexibility, continue to provide substantial financial buffers and leverage headroom.
A significant turnaround in profitability turnaround at core subsidiary groups – YTL Power International Berhad (YTLPI) and YTL Cement Berhad (YTL Cement) – as well as improved performance in the hotels and property divisions, has driven the Group’s earnings growth. The Group’s operating profit before depreciation and tax (OPBDIT) climbed 2.5 times over the past five years, reaching RM8.3 bil in fiscal 2025. Accordingly, the Group’s pre-tax profit now exceeds RM3 bil annually. Expansion into digital infrastructure assets, renewable energy assets and further growth in its cement division are expected to support continued earnings growth and diversification.
As an investment holding company, YTL Corp relies on returns from its investee companies – either through operating cashflows (OCF), dividends or capital gains from divestments – to support its ongoing operations and debt obligations. Combined OCF-to-net-debt coverage (including YTLPI) stood at 1.48 times for fiscal 2025 and is expected to remain sound, despite a projected debt increase over the next few years to fund digital business expansion. Annual dividend flows at both YTLPI and YTL Corp (around RM1.2 bil–RM2.0 bil per annum) are anticipated to keep its OCF-to-net-debt coverage ratio above the 0.30 times threshold for a AAA-rating. Furthermore, the Group’s earlier announcement in early 2025 of a warrants conversion corporate exercise to expand its equity base and diversify funding of future investments should help reduce reliance on debt.
While the Group’s digital business and renewable energy initiatives introduce execution risks, these projects – including a green data centre park, artificial intelligence/cloud services and a hydrogen-ready plant in Singapore – are expected to provide medium-term growth opportunities.
Table 1: YTL Corp’s debt facilities
Analytical contacts
L Nurisya Abdullah
(603) 2708 8238
nurisya@ram.com.my
Davinder Kaur Gill
(603) 2708 8220
davinder@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 2026 by RAM Rating Services Berhad
