Prism Energy (Pvt.) Limited

CREDIT RATING REPORT | Nov-25

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Rating History
Dissemination Date Long-Term Rating Short-Term Rating Outlook Action Rating Watch
11-Nov-25 A+ A1 Stable Maintain -
15-Nov-24 A+ A1 Stable Maintain -
17-Nov-23 A+ A1 Stable Initial -
About the Entity

Prism Energy (Private) Limited (“PEPL”) was incorporated in 2019 to invest, develop, and operate solar power projects in C&I sector in Pakistan. PEPL leverages its expertise in the solar sector to offer a range of turnkey solutions tailored to meet customer needs. PEPL Board includes five members. Mr. Arooj Asghar is the CEO of the Company, who is supported by a team of qualified professionals.

Rating Rationale

Prism Energy (Private) Limited (“PEPL”) commenced its solar renewable energy operations in Pakistan in August 2020. The Company operates under three business models: Power Purchase Agreement (PPA), Buyout (BOOT), and Solar on Cash (EPC). Under the PPA model, PEPL invests in solar equipment and sells electricity to customers at an agreed tariff under a long-term contract. In the BOOT model, the Company installs and operates the solar facility, with customers making monthly payments that cover the plant’s cost along with operations and maintenance. Under the EPC model, customers directly finance the installation of solar plants through PEPL on a turnkey basis. As of FY25, Prism Energy (Private) Limited has successfully installed over 12.88 MW of solar capacity across seventeen sites, including multiple projects for Dawn Foods. The Company also entered into a Power Purchase Agreement with a multilateral organization for the installation of a 185kW solar system at its Islamabad offices, which was commissioned in October 2024. During FY25, PEPL recorded a significant revenue increase of approx. 58%, reaching PKR 128mln. However, the Company reported a loss of around PKR 25mln, compared to a profit of PKR 25 million in the previous year. The loss primarily stems from a one-time adjustment related to the revised valuation of previously procured solar panels, whose prices declined substantially over the past three years. Excluding this one-off impact, PEPL’s profit for FY25 would have been around PKR 55mln, nearly double the prior year’s earnings. The Company’s equity base stood at PKR 1,235mln, with no outstanding borrowings. PEPL continues to fund its expansion through internally generated cash flows, reflecting a strong financial profile. The implementation of IFRS 16, which requires recognition of leased assets and related liabilities, has been factored into the Company’s financial reporting; however, this accounting adjustment does not materially affect its financial health or outlook.

Key Rating Drivers

The Ratings draw comfort from the solid and consistent cash flows of PPEL. The ratings incorporate sponsors’ confidence about the soundness of investment strategy in Alternative and Renewable Energy (ARE), as it is completely aligned with the government’s policy to promote renewables in Pakistan. However, the ratings remain dependent on the management's ability to sustain a low-risk profile along with timely receipts from customers. At the same time, maintaining a strong financial profile and liquidity remains critical. Any significant decrease in margins and/or coverages will impact the ratings.

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

Prism Energy (Pvt.) Limited

rating analysis

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Profile
Plant

Prism Energy (Private) Limited operates a portfolio of rooftop solar power plants with a cumulative installed capacity of approximately 12.8 MW across seventeen operational sites, primarily serving commercial and industrial clients. The Company is actively seeking to  develop 40 MW distributed rooftop solar platform that targets financially stable and energy-intensive businesses seeking reliable clean power. Each installation is designed, financed, and maintained by PEPL under a long-term partnership model that guarantees technical reliability and efficiency. The Company’s project pipeline continues to grow, supported by client referrals and industry recognition for consistent delivery performance. PEPL’s operational strategy emphasizes scalability, cost efficiency, and grid independence, aligning with national renewable energy goals.


Tariff

Under PEPL’s business model, tariffs are negotiated directly with clients and offered at a discount to prevailing grid (DISCO) rates. The tariffs, denominated in Pakistani Rupees, are structured to ensure stable, long-term revenue streams under 10–15 year Power Purchase Agreements (PPAs). Payment security is ensured through six-month receivable deposits or bank guarantees from clients, thereby minimizing counterparty risk. The tariff structure considers project size, capital recovery period, and technology specifications to maintain cost competitiveness while safeguarding profit margins. Annual tariff reviews are conducted to adjust for inflation, changes in O&M costs, and currency depreciation. This model ensures predictable returns for the Company while offering clients affordable energy solutions in a high-tariff environment.


Return on Project

PEPL’s projects deliver stable internal rates of return (IRR), depending on project size, location, and contractual tenure, meeting shareholders' expectations. These returns are supported by stable annuity-style cash flows generated through long-term PPAs and BOOT agreements. The Company achieves a payback period of 5–7 years on most installations, after which profits accrue steadily over the project life. Capital costs are fully recovered via installment-based reimbursements embedded in client contracts, reducing exposure to credit default. Operational efficiency and reliable solar resource availability have allowed PEPL to maintain consistent plant performance ratios of 80 % – 82 %. Overall, the project portfolio exhibits a healthy risk-return balance, reinforcing sustainability of earnings and investor confidence.


Ownership
Ownership Structure

PEPL is a joint venture between InfraCo Pakistan Sunrise (holding 95%), a subsidiary of InfraCo Asia, and Albario Engineering (AEPL, holding 4.98%), with nominal individual shareholding. This ownership structure combines strong institutional financial backing with robust local technical expertise. InfraCo Asia, supported by the Private Infrastructure Development Group (PIDG), focuses on mobilizing private investment in sustainable infrastructure across Asia. AEPL contributes extensive experience in EPC and operations, having delivered over 9,000 MW of power plant projects and 5,000 MW of O&M projects nationwide. Together, the partners ensure sound governance and financial oversight. The Company’s consistent ownership since inception underscores a stable, long-term partnership that enhances its credibility and investor confidence.


Stability

Ownership stability is reflected through consistent sponsor capital support and active operational involvement. Both InfraCo Asia and AEPL remain actively involved through board representation and regular technical audits. The stable ownership framework minimizes governance risks, enhances investor confidence, and supports future expansion. With both sponsors dedicated to advancing Pakistan’s renewable energy transition, PEPL’s strong institutional backing serves as a key credit strength against market volatility.


Business Acumen

The sponsors exhibit robust strategic foresight and operational intelligence, reflected in prudent project selection and disciplined execution. InfraCo Asia brings international project-finance capability, ESG compliance frameworks, and risk-mitigation practices drawn from its global portfolio. Their collective experience ensures timely project completion, efficient cost control, and optimized asset utilization. Both sponsors have proven track records in energy infrastructure, enabling PEPL to leverage best practices in technical, financial, and regulatory management. This combination of international oversight and local execution expertise is a critical differentiator within Pakistan’s emerging renewable market.


Financial Strength

The financial position of PEPL provides substantial comfort to creditors and counterparties. PEPL is financially backed by InfraCo Asia which is onward backed by sovereign governments (UK, Switzerland, Australia, and the Netherlands) ensures strong capitalization and access to concessional development funds. The sponsors can provide financial support, in case PEPL requires but so far, PEPL is financially stable and sustain its operations and new projects from its cash flows keeping the Company debt-free. This robust capitalization allows PEPL to absorb potential revenue delays or project deferrals without strain. Overall, the Company’s funding resilience and access to institutional capital remain key rating positives.   


Governance
Board Structure

PEPL’s Board of Directors comprises five members - four nominated by InfraCo Asia and one by AEPL - ensuring balanced representation of both strategic and operational interests. The board composition reflects a blend of international project finance and local engineering expertise. Directors oversee strategic planning, investment approval, and policy compliance under the governance framework of InfraCo Asia. The structure provides clear segregation of executive and non-executive roles, fostering accountability. Regular board meetings ensure proactive monitoring of performance and financial targets. This governance model aligns with international standards while maintaining local operational agility.


Members’ Profile

The board members bring decades of cumulative experience in renewable energy, finance, and infrastructure management. Key members include Mr. Joe Kyaw, Mr. Juan Gin Foo, Mr. Jesse Low, and Mr. Arooj Asghar from InfraCo Asia, and Mr. Ahmad Najeeb from AEPL. Their collective exposure to project development, EPC management, and strategic investment provides depth and continuity to decision-making. Each member contributes specialized oversight - financial governance, technical audit, or stakeholder engagement - ensuring comprehensive control. The board’s diversified expertise supports the Company in balancing commercial viability with sustainability commitments. Attendance levels remain high, reflecting active participation and effective stewardship.


Board Effectiveness

The Board exhibits proactive oversight across strategic and operational areas, including project approvals, risk management, and compliance monitoring. All decisions are guided by InfraCo Asia’s internal control framework, ensuring transparency and efficiency. Independent evaluations and quarterly performance reviews further promote accountability and strong governance practices. The alignment between board directives and management execution has resulted in consistent project delivery, with additional projects in the pipeline totaling approximately 1.5 to 1.8 MW. Regular policy reviews and sponsor-led audits continue to enhance governance effectiveness. The Board’s emphasis on prudent financial management and ESG integration underscores PEPL’s position as a credible and responsible renewable energy developer.


Financial Transparency

Financial reporting adheres to IFRS standards, with external audits conducted by BDO Chartered Accountants, who issued an unqualified opinion for FY24. The FY25 audit process is underway, with no reported irregularities. The Company maintains a transparent accounting system supported by InfraCo Asia’s internal audit and compliance checks. Timely submission of regulatory filings and disclosure of related-party transactions reflect strong control practices. PEPL also prepares quarterly management reports for sponsors, ensuring financial visibility. The consistent audit track record and clean compliance history strengthen credit confidence.


Management
Organizational Structure

PEPL maintains a well-defined, lean, and functionally specialized organizational structure designed for efficient project delivery and oversight. The Company operates through seven key departments—Finance & Administration, Proposal & Design, Business Development, Execution, Operations, Projects & Contracts, and HSE/Environment. Each department is led by a qualified professional with relevant industry experience and clear reporting lines to senior management. The structure emphasizes inter-departmental collaboration, ensuring smooth coordination between project acquisition, engineering, and execution stages. Decision-making authority is decentralized at the operational level but consolidated strategically under the CEO, promoting both agility and control. Regular reporting to the board and sponsors enhances organizational discipline and transparency.


Management Team

The Company is led by Mr. Arooj Asghar, an experienced professional with over two decades in renewable energy, who oversees overall strategy, financial planning, and stakeholder relations. Mr. Arooj Asghar is supported by a core management team including Mr. Abdul Wahab (Financial Controller), Mr. Noman Umar (Chief Financial Officer), Mr. Hassan Bilal (Chief Operating Officer), and Mr. Hammad Rafiq (Head of O&M). The leadership team combines experience in EPC design, portfolio management, and client servicing, ensuring effective operational control. Around twenty engineers and technicians form the technical backbone of PEPL, ensuring timely installation and maintenance. The management’s composition demonstrates strong alignment between technical expertise and commercial execution.


Effectiveness

PEPL’s management demonstrates strong operational efficiency and responsiveness through clear KPIs and standardized reporting mechanisms. Each functional head submits monthly performance dashboards and quarterly progress reports reviewed by the CEO and board. This systematic approach enables early identification of project bottlenecks and cost overruns. The company’s track record of on-schedule project completion and consistent operational uptime (> 98 %) highlights effective leadership. Management decisions are guided by data-driven project evaluation models and robust MIS insights. The combination of technical oversight from AEPL and financial supervision from InfraCo Asia strengthens managerial accountability.


Control Environment

The control environment within PEPL is anchored in strict compliance with InfraCo Asia’s governance framework and Pakistan’s Companies Act 2017. The Company employs internal control systems that include dual-authorization of expenditures, quarterly internal audits, and segregation of financial duties. InfraCo Asia’s audit division periodically reviews operational practices, ensuring adherence to environmental and safety standards. PEPL’s MIS infrastructure enables daily monitoring of cash flows, project status, and procurement activities. Regular staff training on compliance and safety enhances organizational integrity. Collectively, these mechanisms ensure transparency, minimize operational fraud risk, and reinforce internal governance maturity.


Operational Risk
Power Purchase Agreement

PEPL’s core revenue model is anchored in long-term Power Purchase Agreements (PPAs) ranging from 10 to 15 years, ensuring stable cash inflows and predictable project economics. These PPAs are denominated in PKR, structured to match client consumption profiles, and include escalation clauses to reflect inflationary movements. Contracts require clients to provide security deposits equivalent to six months of projected billing, significantly reducing counterparty risk. The agreements also outline clear termination rights, default remedies, and energy-delivery obligations. PEPL’s contract portfolio predominantly comprises creditworthy industrial and commercial clients, lowering collection risk. The contractual diversity across sectors—textiles, paper, healthcare—further mitigates concentration risk.


Operation and Maintenance

The O&M services are being managed entirely in-house rather than outsourced, as was previously practiced. This transition enables greater operational control, improved efficiency, and enhanced quality assurance. The internal operations team oversees preventive maintenance, performance monitoring, and regular inspections to ensure optimal system uptime and reliability. This in-house model allows PEPL to maintain stronger technical oversight while reducing operational costs and ensuring consistent energy generation across its project portfolio.


Resource Risk

Over 95% of Pakistan receives abundant solar radiation averaging 5–7 kWh/m²/day, with the southwestern province of Balochistan and the northeastern region of Sindh recording 2,300–2,700 sunshine hours annually. This positions the country among regions with exceptionally high solar potential. As a solar power producer, PEPL operates within this favorable environment but remains subject to natural variability in solar irradiance and weather conditions that can influence annual energy generation.

To mitigate such risks, PEPL benefits from its geographically diversified project portfolio, which reduces exposure to localized climatic fluctuations. The Company employs Tier-1 photovoltaic modules, advanced inverters, and remote monitoring systems to enhance system reliability and minimize yield losses. Regular performance ratio (PR) assessments and irradiance correlation analyses are conducted to validate energy forecasts, while dust and heat-related losses are controlled through automated cleaning systems and structured maintenance protocols.


Insurance Cover

PEPL maintains comprehensive insurance coverage for all operating assets under an “All-Risks” policy that includes protection against fire, flood, theft, terrorism, and machinery breakdown. Policies are renewed annually with reputed insurers, meeting both lender and sponsor requirements. Coverage extends to third-party liabilities and business-interruption losses, ensuring financial protection against unforeseen downtime. The insurance portfolio is reviewed by InfraCo Asia’s risk management division to ensure adequacy and alignment with global standards. Claim procedures are clearly defined, enabling swift compensation in the event of damage or disruption. This extensive coverage significantly reduces residual operational risk.


Performance Risk
Industry Dynamics

Pakistan’s total installed power generation capacity stood at ~46,605 MW as of 9MFY25, reflecting a modest 1.6% YoY increase, with renewables contributing around 12% of the mix. Solar’s share rose to ~5%, supported by a sharp increase in net-metered capacity to ~2,800 MW by end-FY25. High electricity tariffs, reliance on imported fuels, and circular debt challenges have driven the shift toward distributed solar systems, particularly within industrial and commercial sectors. The Government’s Alternative & Renewable Energy (ARE) Policy 2019, targeting a 30% renewable share by 2030, continues to support long-term sectoral growth, while technological improvements and lower PV costs enhance viability. However, recent adjustments to net-metering regulations may affect smaller-scale consumers. PEPL, positioned in the industrial rooftop segment, remains relatively shielded from such policy risks and is well-placed to benefit from Pakistan’s expanding renewable energy landscape.


Generation

Across its 17 operational sites, PEPL generated around 15 GWh during FY25, reflecting stable performance in line with designed capacity. System availability remained above 98%, with downtime primarily due to scheduled maintenance. The Company’s MIS enables real-time monitoring of generation output, inverter efficiency, and module temperature, allowing prompt identification of performance deviations. New projects totaling 1.5–1.8 MW are expected to be commissioned in FY26, further enhancing geographical diversification and capacity. Sustained operational performance underscores PEPL’s technical reliability and strengthens its overall profile.


Performance Benchmark

PEPL’s overall portfolio maintains a performance ratio (PR) averaging between 80 % and 82 %, comparable to global standards for rooftop solar projects in similar climatic zones. Monthly yield variance typically remains within ± 5 % of modeled projections, underscoring operational consistency. Benchmarking is conducted quarterly against EPC design parameters and verified through independent energy audits. O&M KPIs include inverter uptime, irradiation utilization, and degradation factor, all tracked via remote SCADA systems. The company’s preventive-maintenance regime minimizes PR losses due to soiling or component wear. Stable PR trends strengthen revenue predictability and support rating comfort.


Financial Risk
Financing Structure Analysis

Currently, PEPL’s entire capital structure is equity-financed, totaling approximately PKR 1.23 billion, eliminating interest and refinancing risk. The company plans to introduce project-specific debt, under a 70:30 debt-to-equity mix, leveraging its strong equity base. Future debt is expected to be secured through local financial institutions or development partners, backed by stable PPA revenues. The planned financing strategy aims to optimize cost of capital without overstretching leverage. Prior to borrowing, PEPL intends to establish a Debt Service Reserve Account (DSRA) equivalent to two semiannual payments to preserve repayment capacity.


Liquidity Profile

PEPL’s liquidity profile remains sound, supported by strong equity backing and the absence of external debt. As of FY25, cash and bank balances stood at PKR 16.6 million (FY24: PKR 23.4 million), further the Company has also invested PKR 159.85 million in TDRs (Term Deposit Receipts). Operating cash flows turned positive at PKR 23 million (FY24: negative PKR 86 million), indicating improved cash generation from ongoing projects. Despite this, the Company recorded a pre-tax loss of PKR 25.7 million, mainly due to a net realization loss of PKR 81 million. The debt-free capital structure provides financial flexibility, while active treasury oversight and prudent cash management ensure liquidity adequacy and operational continuity.


Working Capital Financing

The Company’s working capital cycle is primarily influenced by trade receivables from solar projects and payables to contractors. As of FY25, trade receivables declined to PKR 55 million (FY24: PKR 113 million), reflecting collections from prior-year projects. Consequently, trade receivable days improved to 320 in FY25 from 459 in FY24. The Company continues to fund its operational requirements through internally generated cash flows without relying on short-term borrowings. While this demonstrates financial self-sufficiency, further improvement in receivables management would enhance liquidity efficiency and reduce potential cash flow pressures.


Cash Flow Analysis

PEPL’s FY25 performance reflected a 58% year-on-year revenue growth, reaching PKR 128 million (FY24: PKR 81 million). However, the Company posted a net loss, primarily due to the decline in solar panel prices and their subsequent revaluation impact. Gross margins remained strong at 86% (FY24: 84%), despite competitive pricing pressures. The Company’s cash flows are entirely equity-funded, with no finance costs, ensuring a lean operating structure. Capital expenditures are financed through equity and retained earnings, while any future debt obligations will be aligned with PPA-based cash inflows to ensure adequate coverage. The continued improvement in free cash flow underscores PEPL’s strengthening financial position and scalable operations.


Capitalization

The Company’s capitalization remains strong, with equity recorded at PKR 1.23 billion by FY25 and net assets exceeding PKR 1.24 billion. The marginal variation from PKR 1.26 billion in FY24 primarily reflects accounting adjustments related to net realization loss incurred during the solar panel cost adjustment process. Zero leverage eliminates financial gearing risk and provides flexibility for future funding. The Company plans to introduce hybrid debt structures to support growth while maintaining conservative leverage metrics. This robust capital base positions PEPL favorably for credit enhancement once moderate leverage is strategically introduced.
 
 

Nov-25

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Prism Energy (Pvt.) Limited

financial summary

(PKR mln)

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Jun-25
12M		 Jun-24
12M		 Jun-23
12M
A. BALANCE SHEET
1. Non-Current Assets 1,039 754 605
2. Investments 160 239 25
3. Related Party Exposure 0 0 0
4. Current Assets 101 399 124
a. Inventories 8 244 0
b. Trade Receivables 55 113 91
5. Total Assets 1,301 1,393 753
6. Current Liabilities 58 128 24
a. Trade Payables 41 90 18
7. Borrowings 0 0 0
8. Related Party Exposure 0 0 0
9. Non-Current Liabilities 7 5 4
10. Net Assets 1,235 1,261 726
11. Shareholders' Equity 1,235 1,261 726
B. INCOME STATEMENT
1. Sales 128 81 63
a. Cost of Good Sold (18) (17) (11)
2. Gross Profit 110 64 53
a. Operating Expenses (178) (75) (138)
3. Operating Profit (68) (11) (85)
a. Non Operating Income or (Expense) 42 42 9
4. Profit or (Loss) before Interest and Tax (26) 31 (77)
a. Total Finance Cost 0 0 0
b. Taxation 0 (5) (1)
6. Net Income Or (Loss) (26) 25 (77)
C. CASH FLOW STATEMENT
a. Free Cash Flows from Operations (FCFO) (22) 26 (73)
b. Net Cash from Operating Activities before Working Capital Changes (22) 26 (73)
c. Changes in Working Capital 45 64 (332)
1. Net Cash provided by Operating Activities 23 90 (405)
2. Net Cash (Used in) or Available From Investing Activities (30) (378) 56
3. Net Cash (Used in) or Available From Financing Activities 0 509 298
4. Net Cash generated or (Used) during the period (7) 222 (51)
D. RATIO ANALYSIS
1. Performance
a. Sales Growth (for the period) 58.0% 28.4% 194.6%
b. Gross Profit Margin 86.1% 79.1% 83.3%
c. Net Profit Margin -20.1% 31.4% -122.7%
d. Cash Conversion Efficiency (FCFO adjusted for Working Capital/Sales) 18.3% 111.2% -641.5%
e. Return on Equity [ Net Profit Margin * Asset Turnover * (Total Assets/Shareholders' Equity )] -2.0% 2.6% -10.4%
2. Working Capital Management
a. Gross Working Capital (Average Days) 598 1558 2056
b. Net Working Capital (Average Days) 412 1315 1952
c. Current Ratio (Current Assets / Current Liabilities) 1.7 3.1 5.2
3. Coverages
a. EBITDA / Finance Cost N/A N/A N/A
b. FCFO / Finance Cost+CMLTB+Excess STB N/A N/A N/A
c. Debt Payback (Total Borrowings+Excess STB) / (FCFO-Finance Cost) 0.0 0.0 0.0
4. Capital Structure
a. Total Borrowings / (Total Borrowings+Shareholders' Equity) 0.0% 0.0% 0.0%
b. Interest or Markup Payable (Days) N/A N/A N/A
c. Entity Average Borrowing Rate 0.0% #DIV/0! #DIV/0!

Nov-25

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Prism Energy (Pvt.) Limited

rating scale

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Nov-25

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Prism Energy (Pvt.) Limited

regulatory disclosure

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Nov-25

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