RAM Ratings upgrades YTL Power's ratings to AAA

PETALING JAYA: RAM Ratings has upgraded the long-term ratings of YTL Power International Bhd’s (YTLPI) sukuk programmes.

Concurrently, the outlook on the facilities has been revised to stable from positive, it said.

“The short-term rating remains at P1. The upgrade reflects sustained improvements in YTLPI’s fundamental operating and financial profile, underpinned by demonstrable strengthening in its core investments, as evidenced by the growth in the group’s return on capital employed to around 9% over the past three years (fiscal 2021: 3.6%).

“These improvements are supported by YTLPI’s sturdy track record in long-term, regulated concession businesses – primarily infrastructure and utilities – as well as its superior liquidity and financial flexibility, which provide substantial financial buffers and leverage headroom.”

RAM Ratings said a strong turnaround in profitability from core power generation and water subsidiaries has propelled earnings, with operating profit before depreciation, interest and tax tripling over five years to reach a high of RM6.5bil in fiscal 2024.

“The group’s pre-tax profit now exceeds RM2bil annually. The expansion into data centres and artificial intelligence, alongside contributions from its Jordan power plant and upcoming renewable energy assets, is expected to further diversify and grow earnings.”