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RAM Ratings affirms IGB REIT Capital’s RM1.20 bil Second Tranche MTN at AAA/Stable
Published on 06 Aug 2026.
RAM Ratings has affirmed the AAA/Stable rating of the RM1.20 bil Second Tranche Medium-Term Notes (MTN) issued under IGB REIT Capital Sdn Bhd’s RM5.0 bil MTN Programme and secured against Mid Valley Megamall (the Mall). The notes are secured against Mid Valley Megamall, whose high-quality collateral profile and resilient cashflow generation ultimately underpin the rating.
IGB REIT Capital is a special-purpose vehicle established by IGB Real Estate Investment Trust. The rating affirmation reflects the transaction’s strong collateral coverage and our expectation that Midvalley Megamall will continue to generate resilient operating cash flows, supported by its dominant market position, near-full occupancy and strong tenant demand, which help mitigate risks from softer discretionary spending, inflationary pressures and rising operating costs.
In FY Dec 2025, the Mall’s net property income (NPI) grew 9.1% y-o-y to RM363.8 mil, driven mainly by higher base rents, increased service charges and lower operating expenses. The reconfiguration of South Court improved space utilisation and attracted higher-paying tenants, reinforcing the Mall’s rental reversion prospects. Occupancy strengthened to 99.8% as at end-December 2025, with rental averaging a higher RM17.87 psf. Momentum continued into 6M FY Dec 2026, with a NPI of RM189.8 mil, bolstered by festive period and public holiday spending.
Although the Mall’s recent earnings have outperformed RAM’s sustainable annual cash flow assumption of RM350 mil, we have maintained this assumption to reflect the need for clearer evidence that the stronger performance can be sustained through the cycle. The assumption also recognises the Mall’s already high occupancy base and the likelihood that a substantial portion of the benefits from recent asset enhancement initiatives have already been realised.
RAM’s resulting adjusted market value provides substantial collateral support for the MTN, reflected in a loan-to-value ratio of 29.4% and a stressed debt service coverage ratio of 3.43 times. These metrics indicate significant headroom against potential asset value declines or cashflow stress, consistent with the strong protection expected at the current rating level.
Analytical contacts
Zahra Zarir
(603) 2708 8243
zahra@ram.com.my
Lim Chern Yit
(603) 2708 8302
chernyit@ram.com.my
Media contact
Sakinah Arifin
(603) 3385 2500
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
