July 8, 2019 (MLN): Pakistan Credit Rating Agency has assigned Preliminary Rating to Hub Power Company Limited of ‘AA+’, along with a stable outlook forecast.
The rating reflects the holding company character of Hubco with an exclusive focus on the different dimension of the energy sector. In addition to the investment book, Hubco itself is a large RFO based power plant.
Cash flow streams of Hubco's plants are guaranteed by GoP under the Power Purchase Agreement (PPA), subject to adherence to the agreed upon performance benchmarks; this provides comfort to the ratings.
Timely completion of new projects, settlement of receivable and payable and maintaining healthy debt service coverages are important.
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