Press Release

VIS assigns initial ratings to Tower Power (Pvt.) Limited

Karachi, October 05, 2022: VIS Credit Rating Company Limited (VIS) has assigned initial ratings of ‘A-/A-2’ (Single A Minus/ A-Two) to Tower Power (Pvt.) Limited. Outlook on the assigned ratings is ‘Stable’. The medium to long-term rating of ‘A-’ denotes good credit quality with adequate protection factors. Risk factors may vary with possible changes in the economy. The short-term rating of ‘A-2’ denotes good certainty of timely payments. Liquidity factors and company fundamentals are sound, while risk factors are small.

Incorporated in November 2019, Tower Power (Private) Limited (TPL) is a wholly owned subsidiary of Associated Technologies (Private) Limited (ATL). Considering the growth potential of its TowerCo business, ATL decided to separate this business unit to ensure dedicated professional team, separate resources and books of accounts. As part of the arrangement, relevant assets and liabilities shall be transferred to the books of Tower Power (Pvt.) Limited under the Business Transfer Agreement signed in September 2022. Assigned ratings take into account sufficient experience and expertise of parent organization, a sustainable revenue model, and are underpinned by the successful transfer of all assets as mentioned in the agreement schedule.

The overall business risk profile of the industry is considered low given extensive lock-in periods, limited scope for termination, and an escalation clause that is part of the signed agreement with Mobile Network Operators. Furthermore, industry’s demand outlook is positive, given rising demand of towers driven by mounting mobile data usage and sizeable potential for coverage and capacity expansion. Tenancy ratio is a key growth driver in TowerCo business, which remains on the lower side in Pakistan, indicative of room for growth. TPL’s competitive advantage stems from backward integration with parent company-ATL and consistent availability of energy for their towers at all times due to utilization of solar power at more than 90% of the sites. However, complexity of the business environment and increasing competitive intensity in the industry remains key business risk factors.

Assigned ratings also take into account projected financial risk profile of the Company. While leverage indicators are expected to increase in line with the business expansion plans, equity support through injection or profit retention will remain important for maintaining capitalization levels within parameters for the assigned ratings. The ratings are sensitive to planned completion of transfer process and maintenance of projected revenue and leverage levels.

For further information on this rating announcement, please contact Ms. Asfia Aziz (Ext: 212) or the undersigned (Ext: 207) at 021-35311861-66 or email at

Sara Ahmed

Applicable rating criterion: Corporates (August 2021)

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 2022 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .

VIS Credit Rating Company Limited