Lahore, December 17, 2015 (PPI-OT): The Pakistan Credit Rating Agency (PACRA) has maintained the entity ratings of Liberty Power Tech Limited (LPTL) at “A+” (Single A Plus) and “A1” (A One) respectively. The ratings of the Sukuk of PKR 13,488mln and Term Finance Facility of PKR 1,649mln have also been maintained at “A+” (Single A Plus). The ratings denote a low expectation of credit risk.
The ratings reflect LPTL’s strong operational performance vis-a-vis benchmarks agreed with the power purchaser. This entails sovereign guaranteed cash flows. The company’s operations and maintenance operator, Wartsila Pakistan (WPK), is a key source of comfort in managing the plant’s operational risk. The company maintains a healthy financial profile.
Repayment pattern of power purchaser against receivables remained largely volatile, though it has improved somewhat for capacity purchase component (CPP). LPTL prudently managed its working capital requirements. The company, while funding its net working capital from internal generation, lowered its reliance on short term borrowing. However, the company continues to avail the benefit of forbearance period, while making good its financial obligations. Despite sustained profitability, capital augmentation is being limited due to consistent dividend payout.
The ratings are dependent on the company’s ability to maintain a healthy operational profile. Improving, indeed aligning, the company’s repayment behaviour with its financial profile would be ratings positive. Any significant increase in overdue receivables, in turn weakening in cash flows and coverage would be a concern.
Sukuk: LPTL issued a Sukuk in January 2011 for PKR 13,488 mln. The instrument would mature in January 2021. As of Nov15, an amount of PKR 9,327 mln is to be paid in 21 equal quarterly instalments. The profit on issue, payable quarterly, is at 3M Kibor + 300bps.
TFC: LPTL issued a TFC in January 2011 for PKR 1,649 mln. The instrument would mature in January 2021. As of Nov15, an amount of PKR 1,140 mln is to be paid in 21 equal quarterly instalments. The profit on issue, payable quarterly, is at 3M Kibor + 300bps.
For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425