VIS Upgrades Entity Ratings of Zephyr Power Limited - Press Release issued by VIS Credit Rating Company Limited.

Karachi -- February 02, 2023 (PPI-OT)

Following is the text of press release issued by VIS Credit Rating Company Limited

Quote

VIS Credit Rating Company Limited (VIS) has upgraded entity rating of Zephyr Power Limited (ZPL) to 'A+/A-1' (Single A Plus/A-One). Long Term Rating of 'A+' reflects good credit quality; protection factors are adequate. Risk is moderate but may vary slightly from time to time because of economic conditions. Short term rating of 'A-1' indicates high certainty of timely payments; Liquidity factors are excellent and supported by good fundamental protection factors. Risk factors are minor. Outlook on the assigned ratings is 'Stable'. Previous rating was announced on December 31, 2021.

Incorporated as a private limited company in 2005 and later converted into a public unlisted company in June 2021, Zephyr Power Limited ("Company") principally operates a Wind Independent Power Project (IPP) with 25 Wind Turbine Generators (WTGs) located in Gharo, Thatta, Sindh. The IPP interconnection is connected to the national grid which is maintained and operated by the National Transmission Despatch Company (NTDC). The Company has signed an Energy Purchase Agreement (EPA) with the Central Power Purchasing Agency (Guarantee) Limited (CPPA-G). Commercial Operations was achieved in Mar'19 while takeover by management from EPC contractor was completed in Oct'19.

Rating upgrade takes into account smooth operational performance of the project and relative positioning vis-a-vis peers. Assigned ratings also incorporate strong profile of primary sponsor, represented by foreign investment by a Development Finance Institution (DFI) wholly owned by UK Government. The remaining sponsors comprise of a consortium of local partners contributing through equity and management. Ratings also draw comfort from presence of Debt Service Reserve...