MARC Ratings has affirmed the AAAIS/Stable rating for Celcom Networks Sdn Bhd’s (CNSB) RM5b Sukuk Murabahah Programme. CNSB, a subsidiary of Celcom Berhad and ultimately owned by CelcomDigi Berhad, provides network telecommunication services within the group. The rating reflects the robust credit profile of CelcomDigi, supported by its leading position in Malaysia’s telco industry, solid margins, and strong cash flow, despite rising competition potentially impacting earnings.
CelcomDigi holds a 40% market share with 20.4 million subscribers as of June 2025, a slight decrease from the previous quarter. This decline was due to a significant drop in prepaid users, which overshadowed growth in postpaid and Home & Fibre segments. The company is implementing initiatives such as competitive plans, device bundling, and expanded 5G coverage to attract and retain customers, though market competition and pricing pressures remain challenges.
Financially, CelcomDigi’s 2024 performance aligned with expectations, maintaining revenue at RM12.7b, though EBITDA fell to RM5.8 billion due to increased operating costs. In the first half of 2025, revenue and EBITDA were stable at RM6.4b and RM2.7b, respectively. The company anticipates low single-digit growth in service revenue and EBIT, with more substantial gains post-2027 as merger synergies develop.
Liquidity is strong, with cash flow from operations covering capital expenditures and dividends. Borrowings were RM8.9b by June 2025, but cash flow strength supports debt management. The appointment of U Mobile as a second 5G provider alleviates some capital expenditure concerns, although CelcomDigi has invested RM350m in Digital Nasional Berhad, which could affect cash flow. The government is expected to exercise a put option related to these investments by November 2025.
