RAM Ratings places RP Hydro’s sukuk rating on Rating Watch, with developing outlook

Published on 07 Sep 2026.

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RAM Ratings has placed the AA₃ rating of RP Hydro (Kelantan) Sdn Bhd’s RM975 million ASEAN Green SRI Sukuk (2023/2043) on Rating Watch, with a developing outlook.

The rating action follows the Sustainable Energy Development Authority's (SEDA) award of higher installed capacities at higher tariff rates for RP Hydro's three run-of-river hydropower plants in Kelantan, namely Kuala Geris, Kemubu and Serasa (the Project). The award will increase the plants' combined installed capacity by approximately 13.9% to 95.67 MW and lift average tariffs by 18.7%. On 11 August 2026, SEDA announced the results of this year’s feed-in approval exercise, awarding about 331 MW of new and additional renewable net export capacity to 42 successful bidders.

The higher capacities and tariff rates are expected to strengthen the Project's long-term revenue generation and cash flow visibility. However, the expansion will require additional execution, funding and construction considerations, which RAM will assess further against the benefits of the higher capacity and tariffs. The Rating Watch reflects RAM’s ongoing assessment of the expansion’s net credit impact. Our review will focus on the revised project cost, funding arrangements and construction timeline, which remain subject to the receipt of the relevant supporting documentation. We expect to resolve the Rating Watch once the relevant information is available and the credit implications of the expansion can be fully assessed.

RAM’s Rating Watch highlights a possible change in an issuer’s debt rating. It focuses on identifiable events such as mergers, acquisitions, regulatory changes and operational developments that place a rated debt under RAM’s special surveillance. In a broader sense, the Rating Watch covers any event that may result in changes in risk factors relating to the repayment of principal and interest.

Issues are put on Rating Watch when some of these events are expected to or have occurred. The Rating Watch, however, does not mean that the rating will inevitably be changed. It only means that RAM is evaluating the rating and a final affirmation is pending. A “positive” outlook indicates that a rating may be raised while a "negative" outlook indicates a possible downgrade. A “developing” outlook refers to unusual situations in which future events are so unclear that the rating may potentially be raised or lowered.

 

Analytical contacts
L Nurisya Abdullah
(603) 2708 8238
nurisya@ram.com.my

Chong Van Nee, CFA
(603) 2708 8210
vannee@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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