Engro Powergen facing gas curtailment from depleting Qadirpur gas fields: VIS

News Image

MG News | April 24, 2019 at 11:26 AM GMT+05:00

0:00

April 24, 2019 (MLN): VIS Credit Rating Company Limited (VIS) has assigned initial entity ratings of ‘AA-/A-1’ to Engro Powergen Qadirpur Limited (EPQL). Outlook on the assigned ratings is ‘Stable’.

The long term rating of ‘AA-’ signifies high credit quality; protection factors are strong. Risk is modest but may vary slightly from time to time because of economic conditions.

The short term rating of ‘A-1’ signifies high certainty of timely payment; liquidity factors are excellent and supported by good fundamental protection factors. Risk factors are minor.

The assigned ratings draw comfort from significant experience of EEL/Engro in executing similar projects. Moreover, ratings incorporate sound operational track record of the O&M contractor, EESL.

As projected in the implementation agreement, EPQL is now facing gas curtailment from Qadirpur gas field as it is depleting and has made its plant available on mixed mode i.e. comingling of gas and high speed diesel from September 7, 2018 onwards. Terms of the contract also allow conversion to alternate fuel; profitability and cash flows will not be impacted given that fuel cost component and conversion cost are pass-through.

Financial risk profile draws support from strong guaranteed cash flows and satisfactory debt servicing ability. However, persistence of circular debt may translate into some liquidity pressures. By end-2020, gearing levels are expected to decline with complete repayment of long term debt and increase in equity base.

Going forward, improvement in liquidity profile with respect to circular debt and satisfactory plant operation post conversion to alternate fuel will be key rating sensitivities.

Copyright Mettis Link News

Related News

Name Price/Vol %Chg/NChg
KSE100 148,617.78
624.60M
0.86%
1274.27
ALLSHR 91,685.08
1,340.28M
0.74%
669.39
KSE30 45,247.79
197.43M
0.83%
370.74
KMI30 212,370.79
224.51M
1.05%
2209.48
KMIALLSHR 61,227.89
711.87M
1.18%
715.56
BKTi 41,264.02
160.39M
0.54%
221.73
OGTi 30,019.10
23.63M
0.64%
190.41
Symbol Bid/Ask High/Low
Name Last High/Low Chg/%Chg
BITCOIN FUTURES 108,265.00 113,390.00
108,020.00
-4475.00
-3.97%
BRENT CRUDE 67.46 67.94
67.29
-0.52
-0.76%
RICHARDS BAY COAL MONTHLY 88.70 88.70
88.70
-0.75
-0.84%
ROTTERDAM COAL MONTHLY 96.15 96.75
96.00
-0.40
-0.41%
USD RBD PALM OLEIN 1,106.50 1,106.50
1,106.50
0.00
0.00%
CRUDE OIL - WTI 64.01 64.55
63.88
-0.59
-0.91%
SUGAR #11 WORLD 16.34 16.52
16.33
-0.14
-0.85%

Chart of the Day


Latest News
August 30, 2025 at 04:28 PM GMT+05:00

Key Pakistan Market Stats and Economic Indicators


August 29, 2025 at 06:04 PM GMT+05:00

SCRA inflows offset Rs8.5bn net selling


August 29, 2025 at 05:46 PM GMT+05:00

SECP cuts bonus, right issue timelines



Top 5 things to watch in this week

Pakistan Stock Movers
Name Last Chg/%Chg
Name Last Chg/%Chg