MARC Ratings has affirmed its rating of AAIS on UEM Edgenta Berhad's Islamic Medium-Term Notes (IMTN) Programme of up to RM1.0 billion. The rating outlook is stable.

The rating affirmation is premised on UEM Edgenta's established track record in providing healthcare support services (HSS) under government and private contracts in Malaysia and overseas, and highway and road maintenance services domestically. The affirmation is supported by a conservative balance sheet with low leverage and strong liquidity, tempered by margin pressures from higher operating costs, contract renewal risk, and constrained pricing flexibility with key clients.

UEM Edgenta provides healthcare and facilities management services through its asset management portfolio. Its healthcare segment serves public and private hospitals in Malaysia and, through wholly owned subsidiary UEMS Pte Ltd, has expanded steadily into Singapore and Taiwan, lowering dependence on HSS concession contracts in Malaysia. In 1H2025, the group secured RM3.0 billion in contracts (2024: RM2.8 billion), comprising renewals and new awards. HSS contributed 83% of the new order book, including RM1.2 billion from Singapore and Taiwan. Domestically, subsidiary Edgenta Mediserve renewed its HSS concession for 32 government hospitals in Peninsular Malaysia on 1 April 2025 for a three-year term, with options for two additional one-year extensions, following the expiry of the previous 10-year contract on 31 March 2025. The shorter renewal term ensures service continuity pending a broader government review for the next tender cycle. Contract terms remain unchanged, while discussions continue regarding a potential upward adjustment in the next cycle to reflect increased operating costs, including the rise in minimum wage.

Through wholly owned Edgenta PROPEL Berhad, the group holds a long-term master maintenance services contract with related company Projek Lebuhraya Usahasama Berhad for highway maintenance, providing an as