PACRA Maintains the Entity Ratings of Master Wind Energy Limited - Press Release issued by The Pakistan Credit Rating Agency Limited.

Lahore -- September 30, 2022 (PPI-OT)

Following is the text of press release issued by The Pakistan Credit Rating Agency Limited (PACRA)

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Master Group, pioneers of foam products, has set up a 52.8MW wind power plant - Master Wind Energy Limited. The project is established under the Policy for Development of Renewable Energy for Power Generation, 2006 which offers a guaranteed internal rate of return, cost indexation, and pass-through tariff structure. Working capital requirements are fulfilled through in-house adequate cash flow generation. Free cash flows of the Company are in a comfortable position to make debt repayments.

Master Wind has repaid 11 installments of its debt on time without availing benefit of forbearance period, facet of strong financial profile and working capital management. The company's reserve build-up mechanism, DSRA fully funded through cash and PSRA funded via SBLC providing coverage of more than one time on its financial obligations till maturity, provides comfort to the ratings. Though, the company signed the MoU but the execution of Master Agreement and EPA Amendment Agreement is contingent to approval from the foreign lenders.

During the period, FY22, the company has generated 137.6GWh as compared to 111.8GWh in corresponding period. The project revenues and cash flows are exposed to two main risks. First; wind risk. Under the upfront tariff regime, any variability in wind speeds is to be borne by the Company, due to which its cash flows may face seasonality. However, historical wind speeds...