Press Release
VIS places the Ratings of Kot Addu Power Company Limited on Rating Watch- Developing
Karachi, March 31, 2026: VIS Credit Rating Company Limited (VIS) has placed the entity ratings of Kot Addu Power Company limited (‘KAPCO’ or ‘the Company’) of ‘A+/A1’ (Single A plus/A One) on Rating Watch- Developing. The long-term rating of 'A+’ denotes good credit quality; Protection factors are adequate. Risk factors may vary with possible changes in the economy. The short-term ratings of ‘A1’ indicates strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Previous rating action was announced on January 24, 2025.
KAPCO was incorporated on April 25, 1996, as a public limited company under the Companies Ordinance, 1984 (now Companies Act, 2017) and was listed on the Pakistan Stock Exchange Limited (PSX) on April 18, 2005. The Company operates a multi-fuel (gas / RLNG, furnace oil and high-speed diesel) power generation facility in Punjab. The Company entered into a Tripartite Power Purchase Agreement (TPPA) for 495 MW capacity with the Central Power Purchasing Agency (Guarantee) Limited (Power Purchaser) and the National Grid Company of Pakistan Limited on June 3, 2025.
In light of the Pakistan Stock Exchange (PSX) notifications dated January 30 and February 17, 2026, VIS has placed the ratings of KAPCO on Rating Watch – Developing. KAPCO, along with Fauji Cement Company Limited, has entered into a Share Purchase Agreement with Pharaon Investment Group Limited Holding S.A.L. for the acquisition of 84.06% shareholding and joint control of Attock Cement Pakistan Limited (ACPL), and has announced a public offer at PKR 330.41 per share. The proposed transaction represents a strategic diversification outside KAPCO’s core power generation operations and may have implications for its business and financial risk profile.
The placement on Rating Watch-Developing reflects the pending clarity regarding the transaction structure, funding arrangements, leverage impact, and integration strategy. VIS will reassess the ratings upon receipt of detailed information and greater visibility on the potential impact of the acquisition on KAPCO’s business and financial risk profile.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Corporate Rating
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf