MARC Ratings has affirmed its AAAIS rating on TTM Sukuk Berhad's (TTM SPV) RM600.0 million Sukuk Murabahah with a stable outlook. The rating reflects the rating agency's assessment of strong support for the Trans Thailand-Malaysia project, a strategic joint venture between national oil companies Petroliam Nasional Berhad (PETRONAS, Malaysia) and PTT Public Company Limited (PTT, Thailand).

TTM SPV is a wholly-owned funding vehicle of Trans Thai-Malaysia (Thailand) Limited (TTMT), a 50:50 joint venture between PETRONAS and PTT, established to finance two gas pipelines transporting natural gas from the Malaysia-Thailand Joint Development Area in the Gulf of Thailand to the industrial city of Rayong, Thailand (TTM Phase II). MARC Ratings does not view the rating as constrained by Thailand's foreign currency rating. The rating agency believes PETRONAS has a strong strategic and reputational incentive to provide ringgit liquidity if transfer and convertibility restrictions arise. PETRONAS holds a public information rating of AAA/Stable from MARC Ratings.

TTMT's credit profile benefits from stable, predictable cash flow backed by long-term service agreements with PTT and PETRONAS, and a cost-plus tariff structure that supports consistent profit margins. Its unit capacity reservation charge (UCRC) covers operating costs and debt service, while ensuring adequate shareholder returns.

TTM Phase II's revenue rose 7.2% y-o-y in 1H2025 to USD10.4 million on higher UCRC (January-May, 2025: USD152.16/mmscf; 2024: USD149.33/mmscf). In 2024, revenue increased 2.1% y-o-y to USD19.9 million, with the annual financial service coverage ratio at 1.40x as of end-2024, exceeding the 1.10x covenant. Overall, credit metrics are expected to remain stable until the sukuk matures on 14 November 2025, supported by steady gas demand and the UCRC pricing mechanism.

At TTMT's level, 1H2025 revenue rose 19.5% y-o-y to USD63.0 million, driven by higher UCRC. Total borrowings stood at USD14