Press Release

VIS Reaffirms Entity Ratings of Gharo Solar Limited

Karachi, October 27, 2025: VIS Credit Rating Company Limited (VIS) reaffirms entity ratings of Gharo Solar Limited (“GSL” or “the Company”) at 'A+/A1' (Single A plus/A One) with a “Stable” outlook. Medium to long term rating of ‘A+' indicates good credit quality; protection factors are adequate. Risk factors may vary with possible changes in the economy. Short term rating of 'A1' indicates a strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. Previous rating action was announced on September 26, 2024.

Incorporated in 2016 as a public unlisted company, GSL operates a 50 MW solar photovoltaic (PV) power plant located near Gharo, District Thatta, Sindh, dedicated to generating and supplying electricity to K-Electric. Developed with significant foreign investment, the plant commenced commercial operations in December 2019 and supplies power under a 25-year Energy Purchase Agreement (EPA) with K-Electric. The EPA includes a ‘must-run’ provision, exempting the project from merit order dispatch due to its renewable nature. The tariff follows a cost-plus structure, indexed to consumer price indices (CPIs), and ensures a fixed return on equity.

The assigned ratings reflect Gharo Solar Limited’s consistent operational performance under a long-term Energy Purchase Agreement (EPA) with K-Electric, stable cash inflows secured through an escrow mechanism, and sound financial flexibility. The Company has maintained strong profitability margins, supported by a cost pass-through tariff structure indexed to CPIs. Gearing and leverage indicators have improved, driven by scheduled debt amortization and equity accretion. Liquidity and coverage metrics have also strengthened on the back of robust operating cash flows and reduced finance costs following the decline in benchmark interest rates.

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

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 October 27, 2025 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.