Karachi: VIS Credit Rating Company Limited has affirmed the entity ratings of Engro Powergen Qadirpur Limited at ‘AA-/A-1’, signaling high credit quality and a strong likelihood of timely repayment of obligations. The outlook on the ratings has been revised to ‘Stable’ from ‘Positive’.

According to VIS Credit Rating Company Limited, the ratings reflect the strong credit position of Engro Powergen Qadirpur, supported by its long-term Power Purchase Agreement with CPPA-G and an Implementation Agreement with the Government of Pakistan. These agreements provide stability and mitigate credit risk, enhancing the predictability of the company’s operational revenue. Engro Powergen Qadirpur, operating a 226.52 MW combined cycle power plant since 2010, benefits from government backing and structured cash flow mechanisms which ensure consistent profitability and manage liquidity.

The financial health of the company is bolstered by tariff indexations that adjust for inflation and exchange rate variations, maintaining margin consistency despite macroeconomic fluctuations. The future ratings of Engro Powergen Qadirpur will depend on the ongoing effectiveness of its macroeconomic hedging strategies and the company’s ability to manage potential risks associated with fuel supply and changes in the regulatory environment.