Is RR.L (Rolls-Royce Holdings plc) Halal or Haram?

Based on our AAOIFI-standard shariah screening, RR.L is Halal and considered permissible for Muslim investors. It passed all 4 of 4 compliance screens including business activity review, debt-to-market-cap ratio (4.84% vs ≤33% threshold), interest income ratio (1.28% vs ≤5% threshold), and cash & securities ratio (5.91% vs ≤33% threshold).

Rolls-Royce Holdings plc is a global industrial technology leader best known for designing and manufacturing high-performance aero engines that power many of the world's large commercial aircraft, such as the Airbus A350 and Boeing 78 7. Beyond civil aerospace, the company operates a robust Power Systems division providing propulsion for marine vessels and backup power generation, alongside a significant Defence segment supplying engines for military transport and combat aircraft. This diverse portfolio positions them as a critical player in global infrastructure and transportation. For Muslim investors, Rolls-Royce is currently classified as Halal, having successfully passed all four AAOIFI shariah screening criteria. This means the company's primary business activities are permissible, and its financial structure meets Islamic standards regarding debt and interest. Specifically, the company maintains very low levels of interest-bearing debt relative to its market value , and its non-compliant income from cash deposits remains well within the 5% tolerance limit. From a financial perspective, the most attractive aspect for halal investors is the company's current Debt-to-Market Cap ratio of just 4.8%. This low leverage suggests the company is not heavily dependent on interest-based loans to fund its operations, which is a key marker of shariah compliance. Additionally, with cash and securities making up only 5.9% of its market cap , the company is efficiently deploying capital into its operations rather than hoarding cash in interest-bearing accounts. Investors should continue to monitor the Defence segment, as ethical considerations can sometimes vary between scholars regarding military contractors, though standard AAOIFI screening permits this sector generally. The primary metric to watch going forward is the interest income ratio, ensuring that as interest rates fluctuate , the company's passive income from cash reserves does not creep above the 5% revenue threshold. Rolls-Royce Holdings plc operates in the Industrials sector under the Aerospace & Defense industry and is headquartered in London, GB. The company is led by CEO Tufan Erginbilgic and employs approximately 42,400 people.

RR.L was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. RR.L passed 4 of these 4 screens.

Although RR.L passes all shariah screens, it does earn $271.0M in interest income (1.28% of revenue). Many scholars recommend purifying this portion by donating the equivalent percentage of any dividends received to charity. For example, if you receive $100 in dividends, you would donate approximately $1.28 to purify the income.

RR.L was last screened on 2026-03-01. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.