Press Release
VIS Assigns Preliminary Short-Term Rating to Short-Term Sukuk XII (STS-XII) of Pakistan Telecommunication Company Limited (PTCL)
Karachi, June 13, 2025: VIS Credit Rating Company Limited (VIS) has assigned preliminary rating of ‘AA- (plim)’ (Double A Minus-preliminary) to Geo Entertainment Television (Private) Limited’s (‘GETL’ or ‘the Company’) proposed PKR 1 bn Term Finance Certificates (TFC). The long-term rating of 'AA- (plim)' indicates high credit quality; Protection factors are strong. Risk is modest but may vary slightly from time to time because of economic conditions. Outlook on the assigned rating is ‘Stable’. The outstanding entity ratings of GETL are ‘A/A2’ with a ‘Stable’ outlook.
GETL plans to issue a, secured, privately placed Term Finance Certificate (TFC) of PKR 1 billion, primarily to support the business operations of production of drama serials and drama series. The TFC will have a tenor of four years, including a grace period of twelve months, and will offer a profit rate of 3-month KIBOR plus a spread, payable quarterly. Repayment will be made through 12 equal quarterly installments, commencing from fifteen month after the issue date. A call option is also embedded in the structure, exercisable by the issuer after 18 months, subject to a 60-day prior notice. The TFC is secured against properties and an exclusive hypothecation charge over receivables from six designated customers. In addition, a financial guarantee of Rs 100m (10% of the issue amount) from an AA rated bank is present to cover any shortfall in Debt Payment Account (DPA). DPA is to be funded on a monthly basis for the upcoming quarterly installment with 1/3rd of the amount to be deposited on each month end.
Assigned rating draws comfort from instrument’s security structure further supported by financial guarantee. The rating reflects GETL’s established position within Pakistan’s television entertainment sector. GETL has consistently maintained stable operational performance, underpinned by strong brand equity and continuous content investment. Benefiting from a loyal viewership and extensive nationwide distribution, GETL has continuously ranked among the top two entertainment channels by audience share over the past few years. The rating also incorporates the strategic and operational support derived from being part of the Jang Group, allowing the Company to leverage group synergies and industry experience. Despite competitive pressures in the media industry, in light of shifting viewer preferences, rising digital content penetration, and fluctuations in domestic advertising spends, GETL has effectively retained its viewership through sustained investment in high-quality content.
Rating incorporates GETL’s consistent revenue growth, driven by strong performance in international and digital segments. Despite pressure on domestic ad revenue, profitability margins have improved, supported by cost rationalization measures. Rating also takes into account the Company’s zero gearing to date, though maintaining gearing, going forward, within reasonable thresholds remains important. The equity base remains modest, while liquidity challenges persist due to an extended working capital cycle and continued intercompany cash flow movements with group companies.
For further information on this ratings announcement, please contact 021-35311861-64 or email at info@vis.com.pk.
Applicable Rating Criteria:
Industrial Corporates
https://docs.vis.com.pk/docs/CorporateMethodology.pdf
Instrument Rating
https://docs.vis.com.pk/Methodologies-2025/IRM-Apr-25.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf