Press Release
VIS Upgrades Entity Ratings of Zephyr Power Limited
Karachi, June 05, 2026: VIS Credit Rating Company Limited (VIS) upgraded the entity ratings of Zephyr Power Limited (“ZPL” or “the Company”) to AA-/A1 (Double A Minus/ A One) from 'A+/A1' (Single A plus/A One). Medium to long term rating of 'AA-' indicates high credit quality; Protection factors are strong. Risk is modest but may vary slightly from time to time because of economic conditions. Short term rating of 'A1' indicates a strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. The outlook on the assigned ratings remains “Stable”. The previous rating action was announced in April 30, 2025.
Incorporated as a private limited company in 2005, subsequently converted into a public unlisted company in June 2021, ZPL principally operates a wind based Independent Power Project (IPP) with a total capacity of 50 MW employing 25 Wind Turbine Generators (WTGs) located at Gharo, Thatta, Sindh. The IPP interconnection is maintained and operated by the National Grid Company (NGC) (formerly: National Transmission Despatch Company (NTDC)) a Government of Pakistan (“GOP”) owned entity. The Company entered into an Energy Purchase Agreement (EPA) with the Central Power Purchasing Agency (Guarantee) Limited (CPPA-G), a GOP-owned entity on April 13, 2017. The EPA is based on the 2006 Renewable Energy Policy and the 2016 Upfront Tariff awarded by the National Electric Power Regulatory Authority (NEPRA). The Company achieved its Commercial Operations Date on March 28, 2019. The term of the EPA is for twenty years commencing from the date of COD.
Ratings upgrade reflects the Company’s sustained operational performance and financial risk profile at a low-to-moderate level within the renewable energy sector. The ratings draw comfort from the long-term EPA with CPPA-G, supported by sovereign backing, ensuring stable revenue visibility and predictable cash flows.
Operational performance reflects improved capacity factors during FY25 and 1HFY26, supported by lower curtailment and consistently high plant availability, indicating stable operational efficiency. The financial profile has strengthened, driven by declining leverage on account of scheduled debt repayments, underpinned by stable tariff-based cash flows under the long-term EPA. While profitability moderated in FY25 due to lower tariff levels, margins remained broadly stable in 1HFY26.
The sponsor profile continues to provide credit comfort, supported by experienced local sponsors and foreign participation from a Development Finance Institution. Liquidity remains adequate, supported by stable operating cash flows, sovereign-backed receivables, and minimal reliance on short-term borrowings. Debt coverage of the Company remains at comfortable levels.
For further information on this rating announcement, please contact at 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Industrial Corporates
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf