Pakistan Credit Rating Agency assigns preliminary rating to proposed Sukuk of Pakistan Mobile Communications Ltd
Lahore, January 07, 2014 (PPI-OT): The Pakistan Credit Rating Agency Limited (PACRA) has assigned premilinary rating of ‘AA’ (Double A) to the proposed listed Sukuk issue of PKR 6,900mln by Pakistan Mobile Communications Limited (PMCL). This rating denotes a very low expectation of credit risk.
The preliminary rating of proposed sukuk reflects the strong business fundamentals of the issuer – Mobilink – supplemented by comfort added through the security structure. The Sukuk is structured to be redeemed through sale of prepaid cards under agency agreement with the lenders. Additionally, Sukuk holders would be guaranteed up to PKR 966mln by a European Sovereign DFI.
Notably, the guarantee amount would stay constant throughout the term; hence, increasing the coverage with principal repayment. PMCL enjoys strong market position in the local cellular industry. The largest operational network, highest subscriber base, sound technological infrastructure, and effective marketing strategy are key strengths of the company.
The company’s profitability indicators have witnessed improvement. Financial risk profile is likely to rationalize further, albeit gradually, as upcoming debt maturities would be majorly funded from a mix of internal generation and commercial credit.
Discretion of the sponsor on receiving management fee provides comfort to cash flows. Association of PMCL with one of the world’s largest telecom operators – VimpelCom – remains a key rating factor.
For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425