Press Release

VIS Reaffirms Entity Ratings of PGP Consortium Limited

Karachi, November 27, 2020: VIS Credit Rating Company Limited (VIS) has reaffirmed the entity ratings of PGP Consortium Limited (PGPC) at ‘A-/A-2’ (Single A Minus/A-Two) and ‘BBB’ (Triple B) of its preference shares on ‘Rating Watch-Developing’ status. The medium to long-term rating of ‘A-’ signifies good credit quality with strong protection factors. Moreover, risk factors may vary with possible changes in economy. The short-term rating of ‘A-2’ denotes good certainty of timely payments coupled with sound liquidity and company fundamentals. The long term rating of ‘BBB’ signifies adequate credit quality; protection factors are reasonable and sufficient. Risk factors are considered variable if changes occur in the economy. The previous rating action was announced on October 31, 2019.

The ratings assigned to PGPC takes into account company’s ownership profile, unique business model and strategic positioning in the power sector of the country. PGPC is a wholly owned subsidiary of Pakistan GasPort Limited (PGPL), whose associate company Jamshoro Joint Venture Limited (JJVL) has sizable experience of establishing and operating energy sector projects. Ratings factor in company’s low business risk profile encompassing long-term energy supply contract inked with Pakistan LNG Terminals Limited (PLTL) ensuring guaranteed sales. Leverage indicators are comfortable; the same are expected to improve over time owing to debt repayments and internal capital generation and are captured in the assigned ratings. Ratings continue to be on ‘Rating Watch-Developing’ status pending the outcome of the dispute resolution matter with PLTL. Moreover, upholding operational performance in line with agreed performance levels would remain a key rating driver.

For further information on this rating announcement, please contact the undersigned at 021-35311861-70 or Ms. Maham Qasim at 042-35723411-13.



Faryal Faheem
Deputy CEO

Applicable rating criterion: Industrial Corporates (May 2019)
https://www.vis.com.pk/kc-meth.aspx

Notching The Issue (June 2016)
https://www.vis.com.pk/kc-meth.aspx

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright November 27, 2020 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.