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RAM Ratings affirms AA2(s)/P1(s) ratings of debt programmes issued by PROTON’s SPV
Published on 04 Mar 2026.
RAM Ratings has affirmed the AA2(s)/Stable rating of the RM4.0 bil Islamic Medium-Term Notes Programme (2021/2051) and P1(s) rating on the RM1.0 bil Islamic Commercial Papers Programme (2021/2028) issued by PONSB Capital Berhad, a special purpose vehicle (SPV) of Perusahaan Otomobil Nasional Sdn Bhd (PROTON or the Company). The programmes have a combined limit of RM4.0 bil.
The (s) suffix reflects the credit strength of PROTON – acting as the purchase undertaking obligor and its parent, Proton Holdings Berhad (Proton Holdings or the Group). The credit profile of the two entities are equated given their highly interconnected operation and financial profiles.
Proton Holdings continues to maintain its position as Malaysia’s second-largest automotive player, supported by strong brand recognition, an extensive sales and service network and a series of successful product launches. The Group’s recent launches – including e-MAS 5, Malaysia’s first affordable electric vehicle, the redesigned Saga based on the Advanced Modular Architecture platform and a new plug-in hybrid electric vehicle (PHEVs) version of e-MAS 7 – are expected to help keep the Proton marque’s market share at a strong 20%, despite industry competition and regulatory pressure. That said, the inherent cyclicality of the automotive sector and the residual impact of legacy losses continue to moderate the ratings.
Proton Holdings’ unit sales declined 1.0% to 153,237 units in 2024, below the industry’s 2.1% growth in total industry volume (TIV) to 816,747 units. However, sales rebounded in 2025, rising 3.1% driven by the facelifted X50 and the new Saga, raising market share to 19.2% (2024: 18.1%). This outperformed the industry’s muted 0.5% TIV growth of to a record 820,752 units for the year. Profitability strengthened with operating profit before depreciation, interest and tax (OPBDIT) climbing 11.8% in 2024 and 13.5% in 8M FY Dec 2025, supported by cost efficiencies.
As at end-August 2025, the Group’s debt level eased to around RM4.66 bil following the redemption of redeemable convertible cumulative preference shares (RCCPS) borrowings (end-Dec 2024: RM4.75 bil). Although leverage remains elevated due to hefty investment requirements, improved profitability reduced annualised debt to OPBDIT ratio to 4.16 times (end-Dec 2024: 4.81 times). Annualised funds from operations (FFO) debt cover increased marginally to 0.28 times (end-Dec 2024: 0.25 times), with further gradual deleveraging anticipated over the near term.
The issue ratings also incorporate an uplift from extraordinary financial support from Geely Automobile Holdings Ltd (GAH), that holds a 49.9% stake in the Group. Despite DRB-HICOM’s marginally higher 50.1% shareholding, we note that PROTON plays an important role in facilitating GAH’s penetration into ASEAN and other markets. This, combined with GAH’s technological, financial and managerial involvement, positions it as the more influential over the Group. This supports our view that GAH is ‘highly likely’ to provide extraordinary support to PROTON, if required, underpinning uplift to the issue ratings.
Analytical contacts
Nur Hadhirah Binti Bahrom
(603) 2708 8207
hadhirah@ram.com.my
Thong Mun Wai
(603) 2708 8255
munwai@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.
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Similarly, the disclaimers above also apply to RAM Ratings’ credit-related analyses and commentaries, where relevant.
Published by RAM Rating Services Berhad
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