Pak Libya Holding Company Assigned ‘AA-, A1+’ Ratings

The Pakistan Credit Rating Agency (Pacra) has maintained the long-term and short-term ratings of Pak Libya Holding Company (pvt) Limited at “AA-” (Double A minus) and “A1+” (A one Plus), respectively.

The rating of the PPTFC Certificate of Rs 750 million is maintained at “AA” (Double A). The ratings denote a very low expectation of credit risk emanating from a very strong capacity for timely payment of financial commitments. The ratings reflect the joint ownership of PLHC by the Governments of Pakistan and Libya.

PLHC’s overall performance has remained subdued compared to most peers. With selective lending strategy and focused recovery efforts, the company managed to sustain quality of its loan book.

However, sizeable exposure – both in terms of loans and equity investment – in Kamoki Energy Limited (KEL), a rental power plant (RPP), has emerged as a major concern since the operational framework of KEL has been put in jeopardy. The management remains optimistic in this regard. The ratings have negative outlook, highlighting uncertain outcome of the Court’s decision on KEL as unfavourable conclusion may lead to a substantial drag on PLHC’s financial profile.

 

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