Karachi: VIS Credit Rating Company Limited (VIS) has recently assigned a preliminary rating of ‘A-1+ (plim)’ to Pakistan Telecommunication Company Limited’s (PTCL) upcoming PKR 5 billion Short-Term Sukuk VII (STS-VII). This top-tier rating signifies a high level of certainty in timely payment and outstanding liquidity, positioning the sukuk just a notch below the Government of Pakistan’s risk-free short-term obligations.

According to VIS Credit Rating Company Limited, the rating reflects PTCL’s robust market position as a leading Integrated Information Communication Technology company in Pakistan, commanding a substantial 71% market share in the fixed-line network sector. PTCL, transitioning from a state-owned entity to a public limited company in 1995, has expanded its service offerings across Pakistan, including in Azad Jammu and Kashmir and Gilgit Baltistan. It is also progressing in its acquisition of Telenor Pakistan.

The STS-VII sukuk, arranged by a prominent commercial bank and maturing within six months, is designed to fund PTCL’s working capital needs and will adhere to Shariah principles. The profit rate for the sukuk is set at 3M KIBOR plus up to 10 basis points per annum.

VIS’s rating further acknowledges the strategic support PTCL enjoys from its significant shareholders—the Government of Pakistan, which holds a 62% stake, and the Etisalat Group from UAE, holding a 26% stake with management control. The financial stability and management expertise of the Etisalat Group, which has been rated highly by major international rating agencies, also bolster PTCL’s rating.

The assignment of the preliminary ‘A-1+ (plim)’ rating to PTCL’s STS-VII reflects not only the company’s financial robustness and market dominance but also its sound financial risk profile, characterized by positive revenue trends, strong profitability, and sufficient liquidity to meet its obligations.