VIS assigns A-1 rating to KE’s Islamic Commercial Paper

News Image

MG News | August 01, 2019 at 10:25 AM GMT+05:00

0:00

August 1, 2019: VIS Credit Rating Company Limited (VIS) has assigned preliminary rating of A-1 (Single A One) to K-Electric Limited’s (KE) proposed Islamic Commercial Paper (ICP-A) issue of up to Rs. 8 billion (Including a green shoe option of up to Rs. 3billion).

The ICP-A will have a tenor of 6 months. Instrument is unsecured, non-convertible and redeemable at maturity date in bullet payment. The proceeds of the issue will be utilized for KE’s working    capital requirements.

KE has been assigned entity rating of AA/A-1 (Double A/A-One).

The assigned rating recognizes the strategic importance of KE, a vertically integrated utility company, that has exclusive distribution rights in its service area i.e. Karachi and adjoining areas of interior Sind and Baluchistan.

Business risk profile draws support from growing demand for electricity (units sold have increased at a CAGR of 4.57% over the last 5 years) and continuous improvement across various operational metrics including reduction in transmission & distribution and aggregate technical and commercial losses.

Rating incorporates KE’s sound financial profile and sizeable revenue base with net turnover from sale of energy amounting to Rs. 168.6b in FY17.

While remaining within manageable levels, leverage indicators are expected to continue to increase given the significant capital expenditure being incurred and planned over the rating horizon.

Gearing levels are likely to peak at around 1.1 (x) end-FY20 but are than projected to decline to 0.7(x) by end-FY23. Post implementation of the revised Multiyear Tariff, cash flow coverage of outstanding debt remains within manageable levels, and debt servicing coverage ratio is expected to be satisfactory at over 1.5(x) over the rating horizon.

Related News

Name Price/Vol %Chg/NChg
KSE100 134,299.77
290.06M
0.39%
517.42
ALLSHR 84,018.16
764.12M
0.48%
402.35
KSE30 40,814.29
132.59M
0.33%
132.52
KMI30 192,589.16
116.24M
0.49%
948.28
KMIALLSHR 56,072.25
387.69M
0.32%
180.74
BKTi 36,971.75
19.46M
-0.05%
-16.94
OGTi 28,240.28
6.19M
0.21%
58.78
Symbol Bid/Ask High/Low
Name Last High/Low Chg/%Chg
BITCOIN FUTURES 118,140.00 119,450.00
115,635.00
4270.00
3.75%
BRENT CRUDE 70.63 70.71
68.55
1.99
2.90%
RICHARDS BAY COAL MONTHLY 97.50 0.00
0.00
1.10
1.14%
ROTTERDAM COAL MONTHLY 108.75 108.75
108.75
0.40
0.37%
USD RBD PALM OLEIN 998.50 998.50
998.50
0.00
0.00%
CRUDE OIL - WTI 68.75 68.77
66.50
2.18
3.27%
SUGAR #11 WORLD 16.56 16.60
16.20
0.30
1.85%

Chart of the Day


Latest News
July 11, 2025 at 10:56 PM GMT+05:00

Gold price in Pakistan rises Rs2,300 per tola


July 11, 2025 at 05:49 PM GMT+05:00

PKR gains 10 paisa per USD


July 11, 2025 at 05:41 PM GMT+05:00

PSX Closing Bell: Bulls Serenade The Bourse


July 11, 2025 at 05:06 PM GMT+05:00

UBL doubles profit to Rs65bn in 1HCY25


July 11, 2025 at 04:19 PM GMT+05:00

Ideal Spinning Mills to exit spinning business



Top 5 things to watch in this week

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