Press Release
VIS Assigns Preliminary Short-Term Rating to Short-Term Sukuk 1 (STS-1) of Pak Telecom Mobile Limited
Karachi, June 22, 2026: VIS Credit Rating Company Limited (VIS) has assigned preliminary rating of ‘A1(plim)’ (A one preliminary) to PTML’s proposed PKR 5 bn Short-Term Sukuk - 1 (STS-1). The short-term rating of 'A1 (plim)' denotes strong likelihood of timely repayment of short-term obligations with excellent liquidity factors. The outstanding entity ratings of PTML are ‘AA-/A1’ with a ‘Stable’ outlook.
Pak Telecom Mobile Limited (PTML), operating under the Ufone brand, commenced commercial operations in January 2001 and provides mobile voice and data services across Pakistan. PTML is a wholly owned subsidiary of Pakistan Telecommunication Company Limited (PTCL) and operates under licenses issued by the Pakistan Telecommunication Authority. In December 2025, PTCL completed the acquisition of Telenor Pakistan (Private) Limited and Orion Towers (Private) Limited, with Telenor Pakistan continuing to operate as a separate legal entity during the ongoing integration process with PTML/Ufone.
PTML plans to issue a rated, unsecured and privately placed STS-1 of PKR 5 billion (inclusive of a green-shoe option of PKR 2 billion), based on a suitable Shariah-compliant mode of short-term Islamic financing. The instrument, being arranged by a leading commercial bank, will have a tenor of up to six months and will be callable after one month from the date of issuance. The proceeds will be utilized to finance the Company's working capital requirements. The expected profit rate on STS-1 will be 3-Month KIBOR plus 0.15%.
The assigned ratings reflect PTML’s strong sponsor profile and continued strategic support from PTCL. The ratings also incorporate the Company’s strengthened market position following the acquisition of Telenor Pakistan, which is expected to increase the combined market share to approximately 35%, positioning the merged entity as the country’s second-largest mobile operator. The enhanced scale is expected to improve competitive positioning, expand the subscriber base, and generate operational synergies through network integration, site rationalization, and cost optimization, supporting long-term growth and profitability.
The Company’s financial profile is underpinned by improving cash flows, operational efficiencies, and continued sponsor support, providing strong financial flexibility. Profitability strengthened in CY25, with topline growth of 20% and a substantial narrowing of losses, while further margin expansion is expected as synergies from the merger are realized, including cost savings from consolidated network operations. Liquidity is supported by established banking relationships, sponsor support, and a negative cash conversion cycle. Looking ahead, disciplined financial management and the successful integration of Telenor operations are expected to drive sustainable growth, with significant improvement in coverage metrics and overall credit quality.
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