Karachi: VIS Credit Rating Company Limited has elevated the entity ratings of AJ Power (Private) Limited, reflecting the company’s robust operational track record and promising financial health in the renewable energy sector.

According to VIS Credit Rating Company Limited, the upgraded ratings from ‘A/A-2’ to ‘A+/A-2’ underscore AJ Power’s good credit quality, timely repayment abilities, and stable economic outlook. The company, founded in 2014, operates a 12MW solar power plant in Adhi Kot, Punjab, and has shown significant resilience and profitability in its operations, particularly through strategic contracts and agreements ensuring consistent revenue.

The uplift in AJ Power’s ratings is attributed to its solid operational history and improved financial metrics. The company has managed to increase its revenue despite minor fluctuations in energy output, benefiting from escalated tariff rates. Moreover, a boost in other income, primarily from higher returns on short-term investments, has helped counterbalance increased financial expenses. These financial gains are further complemented by AJ Power’s prudent debt management and sustained equity growth, enhancing its leverage and liquidity positions.

Future projections for AJ Power remain optimistic, with the company expected to maintain its sound performance metrics. Key factors contributing to this outlook include continued energy offtake, tariff adjustments, and a robust liquidity management strategy. Maintaining these strengths will be crucial for sustaining the upgraded ratings and supporting long-term financial stability.