KUALA LUMPUR: Malaysian Ranking Company Bhd (MARC) expects website traffic movement along Kuala Lumpur-Karak Freeway (KL-Karak) and Stage 1 of East Coast Expressway (ECE1) to decline subsequent year right before staging a agency recovery in 2022.
The rating agency reported on Tuesday less than its sensitised scenario, it assumed a 30% and 20% decline in targeted traffic for KL-Karak and ECE1 in FY2021 followed by a restoration to 90% of FY2020’s degree in FY2022.
Having said that, by FY2024, MARC expects a whole restoration and a advancement trend of 1%-2% onwards.
In the assertion, MARC affirmed its AAIS ranking on ANIH’s RM2.5bil senior Sukuk Musharakah programme with a steady outlook. ANIH is the concessionaire of KL-Karak and ECE1 right until 2032.
“The affirmed ranking displays ANIH’s healthier hard cash stream technology and suitable credit card debt coverage, underpinned by stable website traffic efficiency of KL-Karak and ECE1, ” it explained.
MARC additional the score also added benefits from the subordinate and equity-like characteristics of ANIH’s RM620mil junior bonds, which should really give some cushion in opposition to operational underperformance.
“However, substantial gearing stays a critical score constraint for ANIH. The secure outlook on the score displays MARC’s expectation that ANIH will continue to exhibit a commendable liquidity profile by sustaining healthier funds concentrations around the following 12-18 months, ” it said.
The rating agency took take note of the affect of the Movement Command Buy (MCO) subsequent the tumble-out from the Covid-19 pandemic and how it has minimized the site visitors on the two highways.
“KL-Karak and ECE1’s visitors information more than April-July 2020 mirrored the affect of Covid-19. Visitors on KL-Karak and ECE1 fell 47.3% and 41.5% y-o-y in the course of the interval, but have rebounded strongly because May 2020 after steps to curb the spread of the virus had been eased in the place highway travel has in reality returned to pre-coronavirus amounts by July 2020.
“Notwithstanding some weaknesses in the very last few months adhering to the coronavirus disaster, site visitors on the experienced KL-Karak and ECE1 have been on a route of regular, albeit average, progress, ” it said.
Highway site visitors for the two highways have grown at a compound yearly progress fee of 1%-2% in excess of FY2015-FY2019 and MARC expects this to keep on the moment Covid-19 is introduced beneath manage.
Assuming the drop in the visitors flow, MARC initiatives ordinary finance assistance coverage ratio (FSCR) at 2.15 instances with a bare minimum protection of 1.93 occasions in FY2028.
“Our projections show that ANIH would be equipped to withstand a profits minimize of 32% y-o-y in FY2021 and nonetheless meet up with the covenanted 1.75 times FSCR, ” it mentioned.