ACT Wind (Pvt.) Limited

RATING REPORT | Jun-26

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Rating History
Dissemination Date Long-Term Rating Short-Term Rating Outlook Action Rating Watch
04-Jun-26 A+ A1 Stable Maintain -
20-Jun-25 A+ A1 Stable Maintain -
20-Jun-24 A+ A1 Stable Maintain -
23-Jun-23 A+ A1 Stable Maintain -
23-Jun-22 A+ A1 Stable Upgrade -
About the Entity

ACT Wind (Private) Limited, incorporated in December 2010, is a Renewable Energy Independent Power Producer (RE IPP) operating under the Renewable Energy Policy 2006, overseen by the Alternative Energy Development Board (AEDB). The capital structure includes 75% debt financing of PKR 6,008 million, priced at 3-month KIBOR plus 3% per annum, with a ten-year repayment tenure initiated in April 2017 through twenty consecutive semi-annual installments, nearing its full completion. The Company's shareholding is equally divided among three sponsors: Tapal Group, Ismail Power (Private) Limited, and Akhtar Power (Private) Limited, who consolidated in August 2013 to jointly develop the project. The Board of Directors consists of nine members, with each sponsor nominating three directors. Mr. Maqsood Ismail serves as Chairman, Mr. Adnaan Tapal as CEO since September 2011, and Mr. Mehmood Suleman has recently joined as CFO.

Rating Rationale

Tapal, Ismail, and Akhtar groups have established a 30MW wind power project – Act Wind (Pvt) Limited ("Act Wind" or "the Company") located in Jhimpir, Sindh. The project was developed under the Renewable Energy Policy 2006, which ensures a guaranteed internal rate of return (IRR), indexed cost adjustments, and a pass-through tariff mechanism. The Company's revenues and cash flows are subject to two primary risks. First, wind risk: Under the upfront tariff model, the variability in wind availability is borne by the Company, making its cash flows potentially seasonal. The Company is obligated to maintain a 31% annual capacity factor, and the current year efficiency factor stands at 20% (9 months: July 2024 – March 2025) as compared to 22% in the prior full year, with the peak wind season (April–June) yet to be captured. Second, operational risk: The Company is obligated to ensure smooth and uninterrupted plant operations. Mitigating this risk, operations and maintenance are handled by Hydro China, an experienced operator with both international and domestic credentials, providing assurance of continued operational reliability and technical competence. Furthermore, the Company maintains comprehensive insurance coverage.For the six-month period ended 1HFY26 (December 2025), Act Wind reported sales revenue of approximately PKR 843 million, compared to PKR 959 million during the same period in 1HFY25. Net profit declined to around PKR 225 million in 1HFY26 from PKR 263 million in 1HFY25. The dip in earnings was primarily due to decreased operational output caused by lower wind availability and authority-mandated curtailments. However, as per the management, both profitability and energy generation have recovered during the ongoing fiscal period, supported by improved wind conditions and enhanced power offtake by the relevant authority. The Company's liquidity position has remained strong, with timely receipt of payments from CPPA-G. Act Wind has been able to meet its working capital needs entirely through internally generated cash flows, without resorting to short-term financing. The Company's free cash flows remain healthy and sufficient for timely debt servicing. As of the reporting period, Act Wind has successfully repaid approximately 87% of its Commercial loan balance and 88% of its Musharaka loan balance on schedule, without utilizing the forbearance period, highlighting the strength of its financial structure and effective working capital management.

Key Rating Drivers

Sustaining sound financial discipline and constantly declining operational performance in line with agreed standards continue to be critical factors influencing the Company's credit profile. The Company's consistent track record of meeting debt obligations through internally generated cash flows remains supportive of its current rating.

REPORT CONTENTS
  1. Rating Analysis
  2. Financial Summary
  3. Rating Scale
  4. Regulatory Disclosure

ACT Wind (Pvt.) Limited


Rating Analysis

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Profile
Plant

The 30MW wind farm spans 197 acres of land near Jhimpir village in Sindh, developed and operated under a Build, Own, and Operate (BOO) model. ACT Wind functions as a Renewable Energy Independent Power Producer (RE IPP), operating in accordance with the Renewable Energy Policy 2006 established by the Alternative Energy Development Board (AEDB).


Tariff

ACT WIND chose to follow NEPRA’s Upfront Tariff structure for wind power projects. According to NEPRA’s 2013 tariff determination for wind Independent Power Producers (IPPs), the company secured a levelized generation tariff of US¢ 16.6932 (PKR 16.2926) per kilowatt-hour (kWh) at the time of financial close. After the commencement of commercial operations (COD) on November 9, 2016, the company applied for a tariff adjustment, resulting in an increased levelized tariff of PKR 18.45 per kWh. As of the April–June 2026 quarter (1HFY26), following indexation, the current applicable tariff stands at PKR 28.7159 per kWh.


Return on Project

ACT WIND mainly generates revenue through the sale of electricity to its power purchaser. Debt servicing is categorized as a non-escalable component, while return on equity (ROE), insurance, and both fixed and variable operations and maintenance (O&M) costs are treated as escalable components. The project’s internal rate of return (IRR), as approved by NEPRA, is set at 13%.


Ownership
Ownership Structure

ACT WIND is equally owned by three groups: Tapal Group (33%), Ismail Group (33%), and Akhtar Group (33%).


Stability

Stability in Independent Power Producers (IPPs) is derived from the contractual agreements between the company and the power purchaser. Based on these arrangements, the stability profile of the company is considered strong.


Business Acumen

The sponsors of ACT WIND possess strong business expertise across diverse sectors. The Tapal Group is involved in the marketing of industrial plants and properties, including power plant systems and mechanical and electrical products. It also has experience in power generation through TEL, a 126MW residual furnace oil-based power plant supplying electricity to K-Electric. Ismail Industries Limited is one of the country’s largest consumer goods companies, producing a wide range of confectionery, biscuits, snacks, and packaging films under well-known brands such as Candyland, Bisconni, SnackCity, and Astro Films. The Akhtar Group primarily operates in denim manufacturing through Akhtar Textile Industries (Private) Limited and has also diversified into the dairy sector with its Dayfresh brand.


Financial Strength

The company’s sponsors demonstrate strong financial capability, with the ability to support the entity on an ongoing basis as well as during periods of financial stress. Their financial strength is underpinned by well-diversified and profitable business operations.


Governance
Board Structure

The Board of Directors (BOD) comprises nine members, including the CEO. Each sponsor group is represented by three members on the Board.


Members’ Profile

Mr. Maqsood Ismail currently serves as the Chairman of the Board. The Board possesses extensive experience across various sectors, including finance, accounting, project management, construction, and manufacturing.


Board Effectiveness

The Board regularly conducts meetings to discuss key matters, including plant efficiency and monthly budget performance, ensuring effective oversight and decision-making.


Financial Transparency

The Company's external auditor, BDO Ebrahim & Co., which is categorized as an "A" rated firm by the State Bank of Pakistan (SBP), has expressed an unqualified opinion on the company's financial statements as of end-June 2025.


Management
Organizational Structure

Independent Power Producers (IPPs) typically operate with a flat organizational structure, primarily consisting of finance and technical personnel, while engineering, construction, and operational activities are largely outsourced.


Management Team

Mr. Adnan Tapal, the CEO, has been leading the company since assuming management control. He brings over two decades of experience across various industries and is supported by a competent and experienced management team.


Effectiveness

The company’s management has played a key role in driving strong organizational performance through effective leadership and consistent results. Their sound decision-making has improved process efficiency and strengthened internal control systems, reflecting positively on overall management quality.


Control Environment

The company leverages advanced IT solutions to enhance operational performance across multiple areas. The quality of its IT infrastructure, along with the scope and execution of its activities, remains satisfactory.


Operational Risk
Power Purchase Agreement

Under the terms of the agreement, if the plant remains available at the contracted capacity factor of 31% and is capable of generating and supplying electricity, the power purchaser is obligated to pay the full tariff, even in the absence of actual offtake. Payments are calculated based on the expected daily kWh generation multiplied by the applicable tariff.


Operation and Maintenance

ACT WIND has entered into an Operations and Maintenance (O&M) agreement with HydroChina for a period of 10 years, commencing from the Commercial Operations Date (COD) in October 2016. HydroChina possesses extensive expertise in the engineering, design, and operation of renewable energy projects, both domestically and internationally.


Resource Risk

Resource variability is an inherent risk for renewable energy IPPs. As wind is the primary resource for the project, the company is exposed to wind risk, defined under the Renewable Energy Policy 2006 as the variability in wind speed affecting energy output. According to the Upfront Tariff structure, this risk is fully borne by ACT WIND.


Insurance Cover

The company maintains adequate insurance coverage to safeguard against property damage and business interruption.


Performance Risk
Industry Dynamics

As of 8MFY26, Pakistan’s power sector showed moderate growth, with total generation reaching 84,192 GWh, reflecting a 3.0% YoY increase . In February 2026, generation stood at 7,696 GWh (+10.8% YoY), indicating improving demand conditions . The generation mix during the month was led by hydel (23%), followed by nuclear (19%), local coal (16%), and imported coal (15%), while RLNG contributed 9% and gas 12% . Wind power accounted for 3% of total generation, with solar contributing 1%.

For companies like ACT WIND, the sector provides revenue stability through CPPA-G’s long-term EPAs. However, generation levels remain dependent on fuel mix, seasonal hydel availability, and demand conditions, as seen from the decline in hydel (-5.3% YoY) and nuclear (-21.5% YoY) generation in February 2026 . Despite sufficient installed capacity, fluctuations in generation and shifting reliance towards coal highlight the importance of maintaining operational efficiency and managing wind variability to ensure stable performance and revenue.


Generation

The plant has an annual nameplate capacity of 262,800,000 kWh. For FY2025, it generated 58 KWh of electricity. In 9MFY26, billed generation stood at 38 KWh.


Performance Benchmark

The plant has contracted benchmarks for efficiency (31%) and availability (88%). During FY25, the plant’s actual efficiency remained below the contractual target, achieving 26% for FY25. In 9MFY26, the efficiency further declined to 20%.


Financial Risk
Financing Structure Analysis

The project was financed with 75% debt, amounting to PKR 6,008 million. This debt is priced at 3-month KIBOR plus a 3% annual spread and has a 10-year repayment tenor. Repayment commenced in April 2017 and is structured in twenty consecutive semi-annual installments. A Debt Service Reserve Account (DSRA), supported through a Standby Letter of Credit (SBLC) covering one upcoming principal and interest payment, is maintained as an important credit enhancement mechanism.


Liquidity Profile

As of the end of 1HFY26, the Company’s total receivables stood at PKR 304 million, reflecting a decrease compared to PKR 683 million reported in FY25 and PKR 1,018 million in FY24.


Working Capital Financing

The Company continues to meet its working capital requirements entirely through internally generated cash flows. This reflects its strong operational position, with PKR 1,618 million in net cash generated from operating activities during 1HFY26, and an additional PKR 645 million repaid against long-term loans during the period. To date, the Company has not utilized any short-term borrowing facilities to finance its working capital needs.


Cash Flow Analysis

As of December 2025 (1HFY26), the Company's Free Cash Flow from Operations (FCFO) stood at PKR 390 million. Although this is lower compared to PKR 965 million in FY25, it still indicates solid operational cash generation, which has contributed to improved debt coverage levels. The EBITDA to Finance Cost ratio also showed marked improvement, increasing to 4.3x in 1HFY26 from 2.4x in FY25 and 2.2x in FY24.


Capitalization

Characterized by a moderate and steadily improving leverage position, the company's capital structure reported a debt-to-equity ratio of 16.8% in 1HFY26. This indicates a continued deleveraging trend compared to 14.4% in 1HFY25, 23.8% in FY25, 36.5% in FY24, and 53.3% in FY23. All remaining debt is in the form of a long-term loan, which has been fully reclassified to current liabilities reflecting imminent repayment, and has been exclusively utilized for the project.
 
 

Jun-26

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ACT Wind (Pvt.) Limited


Financial Summary

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(PKR mln)


 Dec-25
6M		 Jun-25
12M		 Jun-24
12M		 Jun-23
12M
A. BALANCE SHEET
1. Non-Current Assets 3,984 4,175 4,523 4,894
2. Investments 387 914 756 50
3. Related Party Exposure 0 0 0 0
4. Current Assets 931 1,061 1,664 1,526
a. Inventories 0 0 0 0
b. Trade Receivables 304 683 1,018 1,145
5. Total Assets 5,302 6,150 6,943 6,470
6. Current Liabilities 240 374 220 255
a. Trade Payables 174 271 110 182
7. Borrowings 730 1,375 2,455 3,312
8. Related Party Exposure 0 0 0 0
9. Non-Current Liabilities 2 1 1 1
10. Net Assets 4,330 4,400 4,266 2,903
11. Shareholders' Equity 4,330 4,400 4,267 2,902
B. INCOME STATEMENT
1. Sales 843 1,937 3,012 1,935
a. Cost of Good Sold (482) (860) (835) (774)
2. Gross Profit 361 1,078 2,177 1,162
a. Operating Expenses (33) (66) (71) (57)
3. Operating Profit 328 1,011 2,105 1,105
a. Non Operating Income or (Expense) 0 128 62 30
4. Profit or (Loss) before Interest and Tax 328 1,139 2,167 1,135
a. Total Finance Cost (98) (411) (790) (781)
b. Taxation (5) (21) (12) (7)
6. Net Income Or (Loss) 225 707 1,364 347
C. CASH FLOW STATEMENT
a. Free Cash Flows from Operations (FCFO) 390 965 1,694 705
b. Net Cash from Operating Activities before Working Capital Changes 390 966 1,694 705
c. Changes in Working Capital 256 652 (67) 289
1. Net Cash provided by Operating Activities 646 1,618 1,627 994
2. Net Cash (Used in) or Available From Investing Activities 559 (70) (664) 17
3. Net Cash (Used in) or Available From Financing Activities (970) (1,663) (856) (1,140)
4. Net Cash generated or (Used) during the period 235 (115) 107 (129)
D. RATIO ANALYSIS
1. Performance
a. Sales Growth (for the period) -13.0% -35.7% 55.6% -8.9%
b. Gross Profit Margin 42.8% 55.6% 72.3% 60.0%
c. Net Profit Margin 26.6% 36.5% 45.3% 18.0%
d. Cash Conversion Efficiency (FCFO adjusted for Working Capital/Sales) 76.6% 83.4% 54.0% 51.4%
e. Return on Equity [ Net Profit Margin * Asset Turnover * (Total Assets/Shareholders' Equity )] 9.6% 15.1% 33.1% 11.3%
2. Working Capital Management
a. Gross Working Capital (Average Days) 107 160 131 234
b. Net Working Capital (Average Days) 59 124 113 204
c. Current Ratio (Current Assets / Current Liabilities) 3.9 2.8 7.6 6.0
3. Coverages
a. EBITDA / Finance Cost 4.3 2.4 2.2 0.9
b. FCFO / Finance Cost+CMLTB+Excess STB 0.8 0.5 0.9 0.4
c. Debt Payback (Total Borrowings+Excess STB) / (FCFO-Finance Cost) 1.2 2.5 2.7 -43.9
4. Capital Structure
a. Total Borrowings / (Total Borrowings+Shareholders' Equity) 14.4% 23.8% 36.5% 53.3%
b. Interest or Markup Payable (Days) 0.0 0.0 0.0 0.0
c. Entity Average Borrowing Rate 14.5% 21.2% 27.3% 21.4%

Jun-26

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ACT Wind (Pvt.) Limited


Rating Scale

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Jun-26

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ACT Wind (Pvt.) Limited


regulatory disclosure

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  1. Rating Team Statements
    1. Rating is just an opinion about the creditworthiness of the entity and does not constitute a recommendation to buy, hold, or sell any security of the entity rated or to buy, hold, or sell the security rated, as the case may be. (Chapter III; 14-3-(x))
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      1. The Rating Team or any of their family members have no interest in this rating (Chapter III; 12-2-(j))
      2. PACRA, the analysts involved in the rating process, and members of its rating committee and their family members do not have any conflict of interest relating to the rating done by them (Chapter III; 12-2-(e) & (k))
      3. The analyst is not a substantial shareholder of the customer being rated by PACRA [Annexure F; d-(ii)]
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