Press Release

Ratings of Quaid-e-Azam Solar Power (Private) Limited

Karachi, November 17, 2017: JCR-VIS Credit Rating Company Limited (JCR-VIS) has placed the entity ratings of ‘AA-/A-1’ (Double A Minus /A-One) assigned to Quaid-e-Azam Solar Power (Private) Limited (QASPL) on ‘Rating Watch - Developing’ status. Previous rating action was assigned on November 17, 2016.

The action of placing the entity ratings on ‘Rating Watch - Developing’ has been taken in view of the Government of Punjab (GoPb) decision to offload its entire stake in QASPL through a privatization process entailing competitive bidding which is expected to be completed by end December, 2017.

QASPL, a 1,000 MW solar park in Bahawalpur, is a wholly owned subsidiary of the GoPb. The company has a power generation license from NEPRA for 25 years. The energy is purchased by Central Power Purchasing Agency (Guarantee) Limited under the Energy Purchase Agreement. QASPL has a sovereign guarantee on payment obligations by the power purchaser. The plant operated satisfactorily and produced 159.87 GWh of energy in FY17. The company also remained compliant of its financial covenants relating to Debt Service Coverage Ratio (DSCR) of 1.25x and minimum current ratio of 1.0 at end-FY17. It also recovered liquidation damages from EPC contractor for not fulfilling the agreed terms of efficiency of the plant mentioned in the EPC contract.

For further information on this rating announcement, please contact the undersigned at 021-35311861-70 (Ext: 234) or Mr. Maimoon Rasheed at 042-35723411-13.


Jamal Abbas Ziadi
Advisor

Applicable Rating Criteria: Industrial Corporates (May 2016)
http://www.jcrvis.com.pk/home2.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 17, 2017 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.