Axiata Group Berhad (AXIATA)
Malaysia / Telecommunications
Active
Issuer Summary
Axiata Group Berhad is a Malaysia-listed regional telecommunications and digital infrastructure holding company. In FY2025, Net Debt / EBITDA improved to 2.46x, while operating-company dividends and debt reduction supported credit quality. The company has an investment-grade foundation, but creditors depend on dividend upstreaming from CelcomDigi, XLSMART, Dialog, Robi, Smart, EDOTCO and others, and structural subordination and emerging-market risk cannot be ignored. The credit view is stable to moderately improving, but recurring dividends excluding the XLSMART special dividend, the terms of the RCF that replaced Sukuk 2026, XLSMART integration, CelcomDigi dividends and EDOTCO refinancing need to be monitored closely.
Axiata’s current credit profile is appropriately assessed as that of a low- to mid-investment-grade regional telecoms holding company. FY2025 balance-sheet repair, Net Debt / EBITDA of 2.46x, operating-company dividends of approximately RM1.7bn, holding-company debt reduction, Baa2 / BBB ratings and strategic Malaysian shareholders support a stable credit view. However, the RM1.7bn dividend receipt includes a special dividend from XLSMART, and Sukuk 2026 was not repaid in cash but replaced with a RM2.0bn RCF. Structural subordination, emerging-market risk, integration execution risk, capex and spectrum burdens, and relatively thin parent-company liquidity prevent Axiata from being treated as a simple defensive telecoms company.
The credit direction is stable to moderately improving. However, the pace of improvement is not fast. Axiata made meaningful progress in FY2025, but the post-restructuring performance record is still in its early stage. Only once CelcomDigi and XLSMART synergies, EDOTCO refinancing, continued dividends from frontier markets, and earnings improvement at Boost and ADA are confirmed from 2026 onward will it be easier to conclude that the FY2025 improvement was structural rather than one-off.
The probability of rapid credit deterioration does not appear high at present. This is because debt reduction has actually progressed, the rating has been maintained at investment grade, operating-company dividends have been received, and strategic shareholders and capital-market access are present. However, the scope for rapid improvement is also limited. Axiata has a holding-company structure, depends on dividend upstreaming and is exposed to several emerging markets, so it will not become a low-risk issuer like a high-rated single-country telecoms operator.
Issuer Reports
Current public reports for this issuer.