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Wednesday, September 2, 2009

Suncity to maintain profitability: RAM

SUNWAY City Bhd is expected to maintain its profitability, given the prime locations of most of its projects, said RAM Ratings.

Concurrently, the group's financials will remain anchored by stable, recurring investment-property income, the rating agency said in a research note today.

"We note recent healthy buying interest in certain projects, driven by low interest rates and the developers'' easy-financing schemes," it said.

Over the next six-12 months, RAM Ratings said this should boost sales with strong branding and strategically located projects, including Suncity.
The rating agency pointed out that Suncity's debt burden remained heavy with RM1.52 billion of borrowings as at the end of June 2009.

In the medium term, the group's debt load is projected to increase to around RM2 billion.

However, Suncity's debt-coverage metrics are anticipated to remain adequate.

RAM Ratings said a sustained and substantial reduction in the group's borrowings would be a key factor for any reassessment of Suncity's ratings.

By Bernama

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