RAM Ratings affirms TM Tech's AAA/P1 sukuk ratings 

RAM Ratings has affirmed the AAA/stable and P1 ratings of TM Technology Services Sdn Bhd's (TM Tech) sukuk: 
	
              Instrument	                    Rating(s)
RM3 bil Islamic MTN Programme (2013/2033) 	   AAA/Stable
RM4 bil Islamic MTN Programme (2018/2048)	   AAA/Stable
RM4 bil Islamic CP Programme (2018/2025)	       P1

A wholly-owned subsidiary of Telekom Malaysia Berhad (TM or the Group), TM Tech houses the Group's core businesses and is the Group's main earnings contributor. Given the inextricable financial and operational linkages between TM Tech and TM, RAM views them in aggregate from a rating perspective. Accordingly, the ratings of TM Tech's sukuk are reflective of the Group's robust credit standing.

On a stand-alone basis, the ratings are anchored by the Group's continued dominance in the Malaysian broadband services space, backed by its extensive fiber network. Its superior profitability and robust credit metrics are key supporting factors. The ratings also consider TM's critical role as the national provider of telecommunications and digital infrastructure and their very strong relationship with the Malaysian Government under RAM's methodology for rating government-linked entities.  

TM leads the retail fixed broadband space, capturing an estimated 66% subscriber market share as of end-2024. Despite a competitive market, its subscriber base came up to 3.2 mil for 1Q 2025, with the average revenue per user registering at RM127 per month, higher than rated peers'. Complementing the broadband segment are the Group's business-to-business segment (under TM One) and carrier-to-carrier division (led by TM Global), which collectively account for half of its top line.  

Overall, TM's revenue and operating profit before depreciation, interest and tax (OPBDIT) were largely flattish at RM11.71 bil and RM4.28 bil for FY Dec 2024. Amid strong cashflow generation and undemanding capital expe